Ali Koiki scored again but then missed a last-minute penalty as the Clarets were denied top spot in the table on a dramatic afternoon at Turf Moor.
Koiki’s superbly taken seventh goal of the season before the break looked to have lifted Burnley above Forest to the head of the U23 Professional Development League’s northern group.
But a late Forest leveler from captain Danny Preston stopped the Clarets making it three wins in a row as Mario Siampanis saved Koiki’s spot-kick after substitute Max Ram had been sent off for tripping Lewis Richardson as he went through on goal.
Steve Stone’s side extended their unbeaten start to seven games with arguably their best performance of the season.
But having dominated for long spells and missed chances to convert an impressive performance into all three points, they were ultimately left frustrated and fourth in the table – level on points with champions Leeds United.
The Clarets had dictated the first half, which was played almost exclusively in the Forest half with the visitors restricted to sporadic counter-attacks mopped up by Burnley’s back four.
And the biggest surprise was that it took almost half an hour for Stone’s side to force the breakthrough.
Adam Phillips tested Siampanis with an early free-kick, while Rob Harker and Lewis Richardson both went close as the Clarets peppered the visitors’ penalty area.
And the pressure finally paid off with another goal from the in-form Koiki.
Richardson was again involved with a smart turn onto Anthony Glennon’s throw-in to work the ball into the penalty area.
Koiki then took over and following a step-over which opened the route to goal, he then curled a right footer into the far corner to extend his scoring run.
Bobby Thomas then headed a Phillips corner over the top and Ne-Jai Tucker dragged a shot just wide as the Clarets pressed for a second goal before the break.
The interval did little to slow the Clarets’ momentum and when Tucker turned provider, with an excellent turn and far-post cross, Koiki should have headed his second and doubled Burnley’s lead with an effort he planted against the crossbar.
And the home side nearly made to pay when Forest finally mustered an effort on target with almost an hour gone, former Bolton Wanderers prospect Zach Clough warming the gloves of Lukas Jensen with an effort from 20 yards.
With Forest sensing a route back into the game, Clough threatened again with a twisting run and a low shot which Jensen did well to palm away from danger.
But the Clarets countered with chances for Richardson to add to the lead as Forest were constantly stretched in the wide areas as Koiki and skipper Anthony Glennon combined effectively down the left flank and Tucker threatened on the right.
Sixteen-year-old Richardson then lifted an effort over the top as he battled away to get on the scoresheet.
And having been unable to put the game to bed, the Clarets were denied victory five minutes from time.
Burnley were unhappy to have a corner awarded against them when Will Swan looked to have headed wide.
But having got the verdict, Forest made the most of it when captain Preston followed up his own header after it hit the bar to nod in from close range.
That was enough to keep them in top spot, although not before the Clarets missed the perfect chance to usurp them.
A poor back pass left Richardson in the clear but after rounding Siamparis and running the ball slightly wide he was tripped by Ram.
The defender was dismissed but Koiki – who scored twice from the spot a week ago and again in a penalty shoot-out win in the Lancashire FA Senior Cup last week – could not hand out the maximum punishment as Siampanis beat his effort away.
Burnley: Jensen; Cooney, Thomas, Younger, Glennon; Tucker (Bayode 87), N’Guessan, Phillips (Goodridge 85), Koiki; Richardson, Harker. Substitutes: McMahon, Cropper, Wilson.
Nottingham Forest: Siampanis; Rama, Spooner (Gallagher 42), Stewart (Ram 59), Preston; Fornah, Barnes; Hayes (Trialist HT), Asare, Clough; Swan. Substitutes: Statham, Sodeinde.
Sent off: Ram
Referee: Thomas Kirk