Zack Coffield delivered the walk-off RBI single for Michigan in the bottom of the ninth inning.
The loss dropped the first-place Clippers to 18-6 on the season, 2 ½ games ahead of Michigan (16-9) and three ahead of River City (17-10) with six scheduled games remaining, and several rainouts that could be replayed to determine the league championship.
The league schedule calls for every team to play 34 games.
The next three games will be crucial for Muskegon, starting Saturday with a doubleheader against Michigan that will complete the three-game weekend series. The Clippers will close out their home schedule on Monday with a 7 p.m. game against River City.
Michigan took the the lead by scoring one run in the first inning on Friday, then added a run in the third and another in the sixth. Muskegon scored once in the third and twice in the sixth to tie the score at 3-3 and set up the dramatic ninth inning.
Relief pitcher Brent Mattson got the win for the Monarchs, allowing no hits or walks in the eighth and ninth innings. Coffield had three hits for Michigan.
Starting pitcher Luke Smith struck out four in 6 ⅓ innings for the Clippers while relief pitcher Nick Holt took the loss.
Connor Glick had two hits while Ryan Mergener had an RBI for Muskegon.