"We were able to hold on at the end and finish, but they kept battling back," Indiana coach Sharon Versyp said.
The Badgers trailed 63-53 with less than two minutes left to play, but went on a 7-0 run over 36 seconds to pull within 63-60 on a pair of Janese Banks free throws.
IU senior point guard Cyndi Valentin, however, converted a pair of lay-ups and made two free throws in the final 1:08, as the Hoosiers solved a full-court press that had contributed to three consecutive turnovers.
After Banks' free throws with 1:12 left, Valentin set up to in-bound the ball and passed it horizontally along the boundary to senior forward Jenny DeMuth. Valentin took off down the court and DeMuth delivered a perfect baseball pass, hitting Valentin in stride for an easy layup.
Valentin converted another transition layup on IU's next possession, but UW answered each time and trailed just 67-64 after freshman forward Christine Spencer's jumper.
The Badgers, though, came up empty on their last three possessions, and DeMuth and Valentin made four free throws to close out the game.
With the loss, Wisconsin fell to 2-8 in the Big Ten and 8-14 overall, while Indiana improved to 12-9 overall and remained in a fourth-place tie in the Big Ten with a 6-4 conference mark.
(Indiana's) seniors are finishing the way they want to finish," UW coach Lisa Stone said. "Our seniors want to too. In our locker room right now, we've got four sad seniors."
Jolene Anderson led UW with 20 points, but fouled out with 19.9 seconds lefts, soon after an awkward jumper came up empty with the Badgers trailing 69-64.
Anderson scored 13 of UW's first 21 points, leading the Badgers to a 21-15 lead with 10:24 left in the first half. But after making four of her first seven shots, including 3 of 4 three-pointers, Anderson made just 2 of 15 field goals, and 1 of 9 triples, the rest of the game.
For much of the first half, the Badgers ball movement was impressive. But the Badgers lacked flow in the second half, particularly during the 12-minute stretch that defined the game. UW shot 27 percent in the second half and 35 percent for the game.
"In the second half, with a 10-point lead… we didn't use clock very well," Stone said. "Our shot selection was not the best during that time. With the lead we sped up and we needed to be more patient."
Banks made 7 of 11 field goals and chipped in 19 points but she and Anderson each had four turnovers. Senior guard Ashley Josephson made just 2 of 12 shots, 1 of 10 three-pointers.
IU's top guns were also hit or miss. Valentin led all scorers with 25 points, and DeMuth contributed 19, but each had six turnovers as IU coughed up the ball 25 times.
"I'm not happy at all with our fouls or turnover situation," Versyp said. "If we continue to do that we'll throw games away and we won't continue to battle where we need to be."
The Badgers out-scored IU 11-5 to open the second half and take a 44-34 lead with 16:19 left. Over the next 12 minutes, however, the Hoosiers dominated, as the Badgers' perimeter shooting went cold and the team failed to work the ball inside against Indiana's zone defense.
"Our post players touched the ball five times in the second half, and that is simply not enough," Stone said.
Indiana, meanwhile, shot 67 percent in the second half.
"Our defense softened," Stone said. "There's no question our defense softened because we weren't scoring."