Thailand U23 had lost 3-1 to Indonesia U23 in the semi-finals while Malaysia were beaten 4-1 by Vietnam on Wednesday, reports the Bangkok Post.
The Thais controlled most of the game and got a chance in the 32nd minute but Phantamitr Praphan was denied by the Malaysian goalkeeper.
In the second half, the hosts kept pressuring Malaysia but saw Chukid Wannapraphao waste a good opportunity with a wide shot.
As both sides failed to find the net in 90 minutes of play, a shoot-out was called under the tournament regulations in which the Thais edged Malaysia 4-3 to seal third place in the regional championship.
In the group stages Thailand beat Myanmar 3-0 in their first game and then Brunei by the same scoreline in their second encounter in the group.
They cruised past Cambodia 2-0 in their final group game to secure qualification for the knockout round.
Vietnam beat Indonesia in Saturday’s final 6-5 on penalties after the game ended 0-0 after extra time.
Vietnam had the chance to win the game in normal time when they were awarded a penalty. However, Nguyen Quoc Viet’s spot kick was saved spectacularly by Indonesian goalkeeper Ernando Ari.
The win meant Vietnam secured their second consecutive AFF U23 Championship title, after winning last year.