Defeat means that the Kirkcaldy side remain in Division Two.
Airdrie host Clyde in Wednesday's first leg of the play-off final.
Airdrie manager Kenny Black
: "We did exactly what we had to do.
"You tell the players to forget they are 2-0 up from the first leg, but that's difficult.
"We managed to score the first goal, but they dominated most of the second half.
"We are frustrated not getting the top spot and automatic promotion, but the boys have a chance to take Airdrie back to where they belong, the First Division."
Airdrie Utd
: Robertson, Smith, Lovering, McDonald, Smyth, Donnelly, Andreoni, Prunty (Watt 73), Russell (Gillies 90), Holmes, Noble (Waddle 64).
Subs Not Used: Brady, Hollis.
Booked
: Andreoni, McDonald.
Goals
: Prunty 10, Donnelly 77.
Raith
: Brown, Wilson, Pelosi, Campbell, Davidson, Tod, Henderson, Silvestro (Carcary 73), Weir, Goodwillie (Bryce 60), Sloan.
Subs Not Used: Borris, David Templeton, Fahey.
Booked
: Weir, Campbell, Sloan, Henderson.
Goals
: Weir 18 pen, 88.
Att
: 2,077
Ref
: C Thomson