The Raptors led by 10 midway through the final period only to collapse down the stretch and suffer a home loss to start the campaign.
Toronto's final points came with 2:15 to play when Kyle Lowry hit two free throws to give the Raptors an 88-85 advantage.
David West brought the Pacers within one when he hit a jumper with 1:18 to go and Hill tied it with 60 seconds remaining by hitting 1-of-2 free throws.
Toronto's DeMar DeRozan missed a layup with 50 seconds to go and, after grabbing the rebound, Indiana ran the shot clock down before Hill attempted a 3-pointer. That try missed, but the Pacers came up with the rebound and again Indiana waited until the end of the shot clock before Hill put up what turned out to be the winning jumper.
Andrea Bargnani misfired on his attempt to tie it at the buzzer.
David West made 12-of-19 shots from the field and scored 25 points to lead Indiana, which outshot Toronto 47 percent to 36. Roy Hibbert and Paul George both had 14 points while George added 15 rebounds.
Kyle Lowry scored 21 points for Toronto and Bargnani had 16.