The defending Premier League champions currently lie in seventh place in the table with five games remaining. They have not finished outside the top three in the top flight since 1991.
"We have not fulfilled any levels of expectations this season," Neville told the BBC's Football Focus show. "We have failed on the football pitch and that doesn't sit kindly with anyone."
United's struggles this season have included their exit from the FA Cup at home to Swansea as well as six league defeats at Old Trafford, although their away record is the best in the division.
They made the last eight of the Champions League before suffering a 4-2 aggregate defeat by Bayern Munich, but they are unlikely to qualify for Europe's elite club competition next season, the first time they will have missed out since 1995-96.
"We are not hiding away from the fact we have underperformed," added Neville, who won the Premier League six times in 10 years as a player with United and also played for Everton for eight years.
"It's been difficult watching other teams above us do well and to even look at a league table.
"I find it difficult to watch Match of the Day on Saturday night; I find it almost impossible because we've suffered this season."
Watch the full interview on Football Focus, Saturday, 19 April at 12:00 BST, on BBC One, BBC One HD and the BBC Sport website.
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