The winner of the last two MotoGP rounds had been confident he would be quick at Aragon after flying in testing during the summer.
Although Lorenzo commenced his day well by beating title rival Marc Marquez's Honda to the practice one top spot, he could only manage fourth in practice two, four tenths of a second off the pace.
"I was expecting to be competitive from the beginning here because I made a lap record in testing, a 1m48.0s, four tenths faster than the record," Lorenzo told the official MotoGP website.
"But today we've got many more problems, especially under braking.
"We don't know exactly what is happening."
Valentino Rossi was only seventh quickest on the second factory Yamaha.
World champion Lorenzo remained optimistic that Saturday would be better.
"We have to believe - we have to think that we can improve the bike for tomorrow and that we can be much faster," he said.