The first defeat in seven games leaves Charlton two points behind United with The Blades' game in hand on Tuesday against Manchester United.
"Our next game is a must-win match, it is as simple as that," Pardew commented.
"The way the results have gone for us this weekend with Sheffield United winning and Wigan getting a point means that our next match could decide our fate.
"It's obviously about results, but you must take positives from the performance as a team and individually.