Despite creating the lion's share of the chances, Uruguay could only breach the opposition defence on one occasion, with Jose Maria Gimenez's 29th-minute header handing them a deserved lead.
However, Lucas Barrios levelled matters before the break, and the scores would remain level after 90 minutes.
In what was a rematch of the 2011 final, Paraguay knew they were assured of a place in the knockout stages before kick-off, while a draw was always going to be enough for Uruguay.
Genuine chances were limited in the opening exchanges, with a number of strong challenges a testament to the tension in the fixture.
It was from a set-piece that Uruguay were able to open the scoring, with Gimenez getting on the end of a Carlos Sanchez corner with a powerful header that shaved the post on its way into the back of the net.
The goal spurred Uruguay into life, and they had a number of chances to add to their advantage. However, they failed to do so and were made to pay for their wastefulness.
Paraguay grabbed an equaliser in the 44th minute, with Barrios meeting Edgar Benitez's lofted corner and headed the ball past Fernando Muslera.
After the interval it was once again Uruguay who had the best of the scoring opportunities, with Edinson Cavani's header from a Maxi Pereira cross going wide before substitute Christian Stuani missed the target from a lofted ball in from Alvaro Pereira.
Villar saved a Cavani volley in the 67th minute as Uruguay were once again denied, and they would not be able to grab a second, with the match finishing level.