Record signing Andy Carroll delivered a blow to Manchester City's Champions League ambitions as Liverpool cruised to a 3-0 victory over Roberto Mancini's side at Anfield on Monday.
Carroll helped himself to his first two goals in a Liverpool shirt since joining from Newcastle for £35 million in the January transfer window.
Dirk Kuyt also netted on a torrid night for City, who lost captain Carlos Tevez to a suspected hamstring injury ahead of Saturday's FA Cup semi-final with neighbours Manchester United at Wembley.
Mancini's expensively-assembled side has now failed to win any of their last six Premier League away games and remain fourth in the table.
The Italian is under pressure to qualify for next season's Champions League.
But City are only three points ahead of fifth-placed Tottenham, who they entertain on May 10, while their London rivals also have a game in hand as the season reaches a thrilling climax.
It was hard to believe judging by their first half performance, but City had arrived at Anfield boasting more clean sheets than any other team in the Premier League.
Yet hopes of a 15th were undone by a shambolic first half defensive display as Liverpool laid the foundations for a seventh win in 12 league matches under Kenny Dalglish with a dominant first half display.
Five-nil winners over Sunderland in their previous game, City were given a taste of their own medicine as they found themselves 3-0 down by half time.
City had already been handed a seventh minute warning of Liverpool's rampant mood by Luis Suarez, the Uruguay forward's powerful low shot striking the post after the faintest of touches by keeper Joe Hart.
But Hart was unable to keep out England team-mate Carroll's majestic finish six minutes later.
It came after Tevez had originally lost possession, Raul Meireles' ambitious long-range effort cannoning off Vincent Kompany straight to Carroll, whose left-foot 25-yard finish flew past Hart into the net.
The joy on Carroll's face told its own story. Having arrived at Liverpool injured, the expensive signing has endured a long and frustrating battle to get fit. But this was pay back time.
A City victory would have taken them above Chelsea into third place and left confidence sky high ahead of next weekend's FA Cup semi-final.
But their evening went from bad to worse.
No sooner had they fallen behind than Tevez threw off the captain's armband after damaging his hamstring before disappearing down the tunnel.
Then Mancini saw his players capitulate as City went from one goal down to trail 3-0 in the space of 60 seconds.
Soon after Fabio Aurelio had been fortunate to escape a red card after an ugly two-footed challenge on Adam Johnson, Liverpool doubled their lead in the 34th minute through Kuyt's well-executed low finish just inside the area.
The inquest was still going on in the City defence when Carroll got the better of Aleksandar Kolarov to head Meireles' cross beyond Hart.
The only positive for the lacklustre visitors in the second half was that they did not concede any more.
In fact, Yaya Toure forced a fine 82nd minute save from Pepe Reina but City's dismal game was summed up when substitute Mario Balotelli, a replacement for Tevez, was subbed himself in the closing minutes.
This was an impressive performance by Liverpool, who gave a debut to 18-year-old right-back John Flanagan.
The win lifts them to within five points of fifth-placed Tottenham and keeps alive their hopes of qualifying for next season's Europa League.