A surprise slip-up by Juventus away to Young Boys opened the door for the Red Devils to leapfrog them in the table, but they were soundly beaten by the Spaniards.
Carlos Soler's first-half strike and an own goal from Phil Jones condemned United to defeat against an opponent who are languishing 15th in the La Liga table, with Marcus Rashford striking a late consolation.
With qualification for the knockout stages already secured and a clash with Liverpool on the horizon, Jose Mourinho rotated his squad heavily but so did the hosts who had even less to play for having sealed a second chance in the Europa League.
Los Che started brightly and took their first opportunity of note when Soler volleyed precisely into the bottom corner following a poor headed clearance from Jones on 17 minutes.
The Red Devils failed to register a single shot on target during the opening 45 minutes, although they did have a reasonable claim for a penalty when Juan Mata's shot was blocked by what appeared to be the arm of Mouctar Diakhaby.
On-loan Chelsea striker Michy Batshuayi had a couple of chances to double Valencia's lead before the break, heading Cristiano Piccini's cross over from six yards out, and slicing a shot wide from the edge of the box following good combination between Denis Cheryshev and Santi Mina.
The half-time scoreline in Bern where Young Boys were leading Juventus 1-0 should have given United hope heading into the second period, but they gave themselves a mountain to climb with Jones's own goal within two minutes of the restart.
Jones knocked the ball past Sergio Romero and into a vacant net from the 18-yard line as both tried to clear a through-ball being chased down by Batshuayi.
Mourinho seemed to give up hope of a comeback and turn his attention to the visit to Anfield when he took off Romelu Lukaku on 69 minutes, but it was after that when United looked most dangerous with Rashford playing as the central striker.
The extra movement of Rashford and fellow substitute Jesse Lingard created more room for United's midfielders, and Andreas Pereira finally tested Domenech with a dipping 30-yard strike which was pushed away from the top corner.
Paul Pogba failed to make a major impression upon being recalled to the starting lineup, but did work Domenech twice from distance in the final 10 minutes as United flirted with a late rally, knowing that Juventus were still trailing in Switzerland.
The Red Devils did halve their deficit on 87 minutes when Young crossed for Rashford to head home from eight yards, and they could have equalised in stoppage time but Mata pulled a difficult over-the-shoulder volley wide from Pogba's pass.
United will hope that they don't come to regret this missed opportunity come Monday's draw for the last 16.
VALENCIA (4-4-2): Jaume; Lato (Garay 51'), Diakhaby, Ruben Vezo, Piccini; Cheryshev (Torres 66'), Parejo, Kondogbia, Soler; Mina (Rodrigo 68'), Batshuayi
MAN UTD: 4-3-3): Romero; Valencia, Jones, Bailly, Rojo (Young 46'); Fred (Rashford 57'), Fellaini, Pogba; Mata, Pereira, Lukaku (Lingard 69')