The highly anticipated battle between sisters Sophie and Abby Erwood was the highlight after both were named in the New Zealand under-21 squad last week.
After its loss to University-Albion in the previous round, Southern started the stronger of the two teams, pushing out to an early 6-4 lead five minutes into the game.
Otago stalwart Jo Morrison returned to the line-up for Phys Ed but she struggled early to finish the shots alongside Sophie Johns at goal attack.
A two-goal run to end the first quarter got Phys Ed back to within one at the first break.
In the second quarter, Phys Ed stepped up its defensive pressure, contesting every Southern pass and not allowing the opposition any easy passages to goal. Kate Gilchrist, in particular, kept Zoe Flockton fighting for position on the circle edge.
The midcourt pairing of Georgina Hunia and Chloe Austin started to find their feet and the attack end opened up as a result giving Phys Ed a 27-23 lead at halftime.
Southern introduced Jen O'Connell at goal shoot at halftime to add some height into the circle and improve its finishing as its accuracy started to fall away in the second quarter.
It paid dividends, restricting Phys Ed's lead and, with 10 minutes to go, the teams could be separated.
The lead changed again several times in the final quarter and, with two minutes remaining and ahead by four goals, Phys Ed looked as though it had the win.
Despite the one-goal loss Phys Ed coach Alice Conrad was pleased with her team's effort.
''It's disappointing having a loss but we can take a lot of confidence out of pushing one of the top teams in the competition,'' she said.
Southern captain Tessa Bekkers was proud of the fight her team showed to escape with the win.
''We never gave up and managed to keep composed and calm in those final minutes to grab the win.
''Our coach gets our shooters to practise those final-second shots and today Sophie showed her calmness under pressure,'' Bekkers said.
In the day's earlier games, University-Albion beat Southern Tui 67-34 while College downed Phys Ed B 67-35.
- Jamie Keay