The Clarets needed to match or better Leeds’ result at Brentford, but they suffered a setback after 20 minutes when Collins handled as Sean Longstaff shaped to head for goal after Nick Pope touched on Kieran Trippier’s corner.
Callum Wilson converted from the spot, and added a second after the break, before Maxwel Cornet pulled one back.
It wasn’t enough, however, but Jackson defended 21-year-old Collins, who has enjoyed an impressive debut Premier League campaign after a summer move from Stoke: "Nathan has been brilliant.
"He's devastated, but I'm not going to criticise a young lad, he's done great for me and I'm sure I'll see him in the future going from strength to strength.
"It will be a learning curve for the lad, but there's no blame on him, he's been terrific.”
Only a week previous, Collins was being hailed after his performance at Spurs, up against England captain Harry Kane.
There Collins, in the absence of captain Ben Mee and James Tarkowski, superbly marshalled a back three, with Nick Pope only beaten by a controversial penalty, converted by Kane.
Jackson said: “I just said that to him in there, those exact words (immense).
"That's brilliant for him, he took on that challenge of playing against one of the best strikers around, which is great for a 21-year-old, but it doesn’t surprise me because I know what he's like and what he's capable of.
“I think he is improving all the time. He has this fearless thing as well, which I think all good players have. They have to have a belief, it is not an arrogance, he wants to improve.
"I think he can still improve on a lot, but he has got a foundation to go on and play at this level for a long time.”
Against Newcastle, Collins was on the right of a back three in possession, and at right back without the ball, as Jackson looked to counter the threat of Allan Saint-Maximin, with Connor Roberts switching from wing back to right midfield.
Roberts was taken off at the break to get Dwight McNeil and Cornet wide, and Jackson explained: "With that, we were looking at their left hand side as their biggest strength and we wanted to make sure we were solid and had more going forward than recently.
"We wanted more width, nothing against Connor.”