Southampton striker James Beattie struck with a dramatic winner two minutes from time to end Manchester United's 21-match unbeaten run in the Premiership.
Sir Alex Ferguson's side had not tasted defeat in the league since losing 3-1 at Middlesbrough on Boxing Day last year and had won their last six straight games.
But Beattie and his Southampton team-mates fully deserved their victory as they took the game to United for whom star striker Ruud van Nistelrooy had a quiet afternoon.
Former England defender Graeme Le Saux was the creator of the goal as he delivered a vicious inswinging corner from the right with just two minutes of normal time remaining.
American goalkeeper Tim Howard came to collect at his near post but the ball fizzed past him allowing Beattie the simple task of heading into an unguarded net from three yards out.
It was no more than Southampton deserved and watching England coach Sven-Goran Eriksson will not fail to have been impressed by Beattie's all-round play and work rate.
Saints enjoyed the better of the chances and could have been two goals up before Beattie's decisive late winner if it had not been for the brilliance of Howard in United's goal.
The giant goalkeeper, who has replaced erratic Frenchman Fabien Barthez in goal this season, saved at full stretch to his right to deny Kevin Phillips in the 67th minute.
Howard then did even better seven minutes later to tip Beattie's looping header over the crossbar after he had been found in the area by a pin-point cross from Fabrice Fernandes.
The Premiership champions, who made two changes from the side that beat Wolves 1-0 in midweek, were strangely quiet from the start with van Nistelrooy well marshalled by Southampton's central defensive duo of Claus Lundekvam and Michael Svensson.
The Dutchman's one chance came in the 32nd minute when he cut in from the left but goalkeeper Paul Jones comfortably saved his shot and it was left to his strike partner Diego Forlan to enjoy the better chances.
Forlan was denied two minutes before half-time by Jones after he had been released on goal by Ryan Giggs and was again thwarted by the Southampton goalkeeper in the 84th minute after striking a fierce left-foot shot goalwards from the edge of the penalty area.
United's French defender Mikael Silvestre should have done better with a free header in the 59th minute when he failed to hit the target from eight yards out but United could have no complaints at the result as they suffered their first defeat of the season.