As is the way with this fixture now, all the build up centred around the fortunes, or misfortunes, of former Liverpool striker Fernando Torres who has endured a torrid spell since joining Chelsea last January, but the former player coming back to hurt his former club was wearing red in West London.
Kenny Dalglish's side began the faster and looked the sharper of the two sides in the early exchanges as Chelsea lumbered about the park looking disjointed and, frankly, a little lost.
Luis Suarez had already wasted two good chances to create glorious openings for his side before John Obi Mikel turned into trouble after Petr Cech's short goal kick just after the half hour. Liverpool took full advantage of the four on two with Craig Bellamy laying the ball into Maxi Rodriguez's path before the Argentine found the far corner of the net.
Uruguayan striker Suarez was, despite not being at his best, being a real nuisance for a Chelsea back four that were all over the place in the first half and he should have stretched the lead before the break but fired wide from the edge of the box.
Andre Villas-Boas brought Daniel Sturridge on at the interval and the England striker quickly justified his manager's faith with a simple finish after Florent Malouda's shot-come-cross dropped to him in the six yard box just ten minutes into the second half.
The Blues suddenly found their game and looked more like their old selves and Pepe Reina had to be at his best to deny Branislav Ivanovic with a world class diving save down low to his left after the Serbian's powerful header.
Chelsea had a few chances thereafter to win the game but they could not really find the right pass in the final third and were made to pay the ultimate price, just minutes after throwing on former Liverpool men Fernando Torres and Raul Meireles with less than ten minutes left.
With three minutes to go Glen Johnson, once of Chelsea, took the ball down and drove beyond Ashley Cole before holding off Florent Malouda and keeping his head to slot the ball into the far corner despite the efforts of John Terry and a despairing Cech.
Liverpool held on for a vital victory as they look to keep themselves in the title race, and also within touching distance of the Champions League places ahead of the visit of leaders Manchester City to Anfield next week. Chelsea were booed off the pitch at the full time whistle and the pressure will continue to mount on Andre Villas-Boas as the Blues continue to struggle in the league.