Vettel started on the front row of the grid at Interlagos but was passed by Valtteri Bottas into the first corner, by Max Verstappen a few laps later and then fell to fifth when he ran wide after locking up at Turn 4.
He eventually finished a distant sixth after being overtaken by Daniel Ricciardo and making a second pitstop.
Ferrari team principal Maurizio Arrivabene said after the race: “Right from the formation lap, we became aware of a problem with a sensor on Seb’s car.
“This meant that, for the whole race, he had to run different settings to those we would have normally used and that made the car difficult to drive.”
Vettel said he was not sure how much of a difference the sensor made and that in the car he tried to do everything he could to work around it.
Having started on soft tyres to Mercedes’ and Red Bull’s supersofts, Ferrari was declared the “favourite” ahead of the grand prix.
Vettel briefly thought his team was “quids in” when his rivals had a brief drop in performance early in the stint but realised it was short-lived and said he expected his rivals to suffer more on the softer compounds.
“The supersoft didn’t struggle enough, let’s put it that way,” said Vettel.
“You could see they had two or three laps where they were in some pain and we thought now we are quids in, but they were faster before and after that phase.
“They were fast, the supersoft was fast, faster arguably, and lasted long enough.
“I don’t think before the race anyone thought a supersoft-soft was feasible but it was actually no problem.”