Southend's defeat at Brentford meant that the U's would have gone top if they had won, but they never fired on all cylinders and the Saddlers claimed a deserved point in their quest to pull clear of the relegation zone.
Phil Parkinson's men have now failed to win either of their last two fixtures, having before gone on a club record run of 10 consecutive victories.
It was actually Walsall who came closest to scoring when they hit the woodwork in the 15th minute of what was otherwise a rather subdued first half.
Grant Smith saw his shot strike the far post after an initial effort from midfielder Pablo Mills had been blocked by Wayne Brown.
Ironically, Colchester's best chance of the first period had come inside the first 30 seconds. Greg Halford chased onto Richard Garcia's throughball and had only keeper Andy Oakes to beat, but dragged his shot wide of the target.
Walsall keeper Oakes, who had a fine evening, had far more to do in the second half as Colchester searched for that elusive goal.
Mark Yeates looked the most likely to break the deadlock. The Tottenham loanee was inches wide with a curling shot on 56 minutes, and shortly afterwards fired a low drive just wide of the near post.
Yeates was in action again in the 80th minute when he got the better of right-back Craig Pead. Yeates' low cross was deflected and substitute Gareth Williams pounced with a shot from close in that Oakes managed to keep out.
Oakes excelled again from the ensuing corner when leading scorer Chris Iwelumo fired in a shot that Walsall's keeper managed to palm away.
The visitors were content to soak up the pressure in the second period, although Mills nearly stole a late winner when heading over the bar from a free-kick routine.