Under-21s head coach Gareth Southgate brought out a squad of U20s for the annual competition in the south of France, which has pitted the Three Lions against Qatar and Brazil so far.
England v Korea Republic
The Toulon Tournament
6.30pm, Wednesday 28 May 2014
Stade de Lattre, Aubagne
Live on BT Sport
And after tasting defeat for the first time this season against Brazil on Monday evening, the Chelsea midfielder believes that could have been just what was needed to provide the team with a real challenge.
"I think after the disappointment of the Brazil game, the lads were a bit down in the changing room but the manager’s told us not to dwell on it," revealed the 19-year-old.
"There were lots of positives to take out of that game so we’ll take them into the next one.
"That was the whole idea of the trip really, to come out here and challenge ourselves.
"No disrespect to the other [Euro qualifying] teams, but we have to try and compete with the bigger countries, the ones who are known for great football.
"If we want to really put ourselves up there, we’ve got to play the teams like that.
"Brazil was a big test and I thought we were really unlucky to lose two unfortunate goals, but I thought we played quite well."
Next up for Chalobah and his team-mates is a clash with Korea Republic in Aubagne on Wednesday evening, when England could take a big step towards reaching the next stage of the competition with a victory.
But having studied the South Korean side since arriving in France, the squad know they can expect another different type of game to their previous two.
"We’ve seen the Koreans in some of their games before we’ve gone to play ours and they look like a good team," Chalobah told TheFA.com.
"They pass the ball about a lot more than what Brazil did in the games that we’ve seen, so they’re a good footballing side and we shouldn’t really underestimate them.
"We’ll go out with the same attitude, to win every game, and this is a crucial one for us to win."
Watch the full interview with Nathaniel in the media player above