The Reds manager controversially rested some of the club’s big names, including captain Steven Gerrard, Mario Balotelli and Raheem Sterling, for the Group B clash.
Real Madrid forward Karim Benzema scored a first-half winner as Liverpool were condemned to their third defeat in the Champions League this season.
And former Aston Villa midfielder Gray was very surprised by Rodgers’ selection for the clash against the Champions League holders.
“I was really, really, really disappointed with the team he sent out,” Gray told talkSPORT.
“To send that team out in a Champions League game, against the champions of Europe, I think Billy Shankly will be rolling around in his grave and thinking ‘what is happening?’.
“It was a submission. I have been reading some of the Spanish press and they are battering Liverpool. They cannot believe a team like Liverpool went to the Bernabeu and basically threw the game. They can’t get their heads around it.”
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