The PNE boss had his angry head on in the wake of a poor second-half performance at Deepdale.
Ahead through Jermaine Beckford’s early goal, North End went on to control spells of the first period and should have stretched their lead.
However, they were poor after the interval with a Nicky Maynard goal pegging them back in the 54th minute.
The major talking point of the game was when MK Dons keeper Cody Cropper saw red for bringing down Eoin Doyle.
Having used all three of their substitutes, striker Alex Revell put on the gloves and saved Joe Garner’s penalty.
Grayson felt that the miss was in line with North End’s second-half display and he wants to see better from them in the remaining games.
He said: “The lads have to have a look at themselves in the mirror.
“They have had a lot of praise this season from the fans and myself, and rightly so because they have done very well.
“There have been very few occasions where I have had to have a go at the players this season.
“But on this occasion they need to think what they can do better to be in the team for the next four games.
“There are some great games to play in, Birmingham away on Tuesday, Burnley here on Friday night, then Reading and Leeds.
“They have done ever so well but there are still places up for grabs for the rest of this season and for next season.
“We have to move forward as a club and to do that we need to keep improving and not let our standards slip.
“As I said, it is rare that I have had to criticise players but this is as frustrated as I have been in a long time.”
Grayson’s frustration was centred on North End being unable to match their display in the first-half with similar after the break.
Their play was sloppy from the start of the second half and MK Dons got far more joy than they had previously enjoyed.
“At half-time I said to the lads that they had played well in the first half because of a really good tempo with and without the ball,” Grayson said.
“I told them that if they did the same thing, they would go on to score the next goal and then they could make it as easy as they wanted it.
“But we just didn’t do the things we had done in the first half, that is why we didn’t get the result which the display in the first half warranted.”
Beckford’s first goal since Wembley last May came in his first start of the season, the striker paired with Eoin Doyle up front in preference to Garner who joined as a 66th minute substitute.
Said Grayson: “In the first half, I thought those two were very good, their link-up play was impressive.
“Doyle worked ever so hard and we had quite a bit of joy in attacking areas.
“We got the full-backs to join in and take their wide players back, we switched play and had options on the ball.
“In the second half we didn’t have that.
“With Jermaine, we just felt that this was the right game to start him in.
“He’s had a few minutes here and there as a substitute and this was the chance to start him. We will see where we go with him from here in terms of more game time.”