Steve Watson marked his first Premiership start of the season with the last-gasp winner as Liverpool were the victims of daylight robbery at St James' Park.
The Anfield side had recovered from the blow of going a goal down in only the second minute to Les Ferdinand's 17th of the season to take complete control.
Skipper Ian Rush shot them back on terms and while Newcastle occasionally threatened, Liverpool were streets ahead, their quality in possession proof that British footballers can pass the ball. Yet the Anfield side missed a hatful of glorious chances -- with Robbie Fowler the main culprit -- and were made to pay in the most dramatic of fashions 30 seconds from the end of normal time. Robert Lee fired in a left-footer from 20 yards which David James could not hold and Watson ran in to joyfully ram home the goal which extended Newcastle's Premiership lead to five points. It sent St James' Park's biggest crowd of the season -- 36,547 -- into ecstasy and left Liverpool bemoaning their fate after they had been so dominant.
The start was as dramatic as the finish. Keegan had bemoaned Ferdinand's omission from the England team in Norway last month and with Terry Venables watching from the main stand, the striker took just two minutes to make his mark. Ferdinand used his upper-body strength to hold off Mark Wright and feed John Beresford, whose cross flicked off a head to reach Keith Gillespie.
The Northern Irish winger mis-hit his shot, but it turned into the perfect pass for Ferdinand to slide in and turn the ball past James.
But Liverpool were in no mood to lie down. Fowler fired wide after being fed by the excellent Steve McManaman, before Rush equalised in the 11th minute with a goal remarkably similar to Newcastle's. Steve Harkness provided the cross from the left, McManaman the right-footer across goal and Rush the predator's touch -- stroking home from close range. It was a vibrant opening to banish the midweek Euro blues and chances continued to come thick and fast at both ends.
Lee was brilliantly denied by James, who somehow turned a shot bound for the bottom corner over the bar. Then Peter Beardsley demonstrated his genius with a truly delightful chip which left James stranded, but cleared the bar by inches.
However, Liverpool's quality in possession, orchestrated by the immaculate Jamie Redknapp, increasingly gave them the edge, with the home side -- who fielded Watson in place of Scott Sellars -- chasing midfield shadows.
Fowler was a fraction wide after Redknapp and Rob Jones had opened the way to goal, and the striker had two more efforts saved by Shaka Hislop.
Lee did flash a shot just outside the upright, but as the game wore on Liverpool strengthened their hold on the middle of the park, Redknapp spraying the ball around imperiously and Harkness and Jones making purposeful incursions down the flanks.
Five minutes after the restart, it required the best of Hislop to keep Newcastle on terms. McManaman worked himself space superbly and his strike took a huge deflection, but somehow the giant keeper stretched out to paw the ball on to the post and the linesman ruled it had not crossed the line. Rush then dragged the ball wide after Redknapp's pass sent him clear and Fowler was not too far off with an acrobatic overhead effort from Harkness.
"What's it like to be outclassed?" taunted the travelling Liverpool fans, Newcastle's response coming on the field as John Scales was forced to make two vital interventions.
In the 66th minute Keegan made his first change, Philippe Albert replacing Gillespie, with Watson moving to the right. But Liverpool remained on top, Redknapp coming so close with a thumping right-footer which beat Hislop's dive, but was too high.
Stan Collymore replaced the unimpressed Rush with 15 minutes to go and twice was a whisker away from being on the end of Fowler crosses, while Wright rose high, only to head wide of the Newcastle goal. Collymore then produced a dream of a ball to put Fowler away 10 minutes from time. The striker rounded Hislop, but missed the target -- symptomatic of his day in front of goal.
It was an escape that spurred Newcastle to their late effort. Suddenly James' goal was under threat again, but nobody could have predicted Watson's late intervention.
Newcastle manager Kevin Keegan admitted his side could not have been luckier after Steve Watson's last minute strike gave them a thoroughly undeserved win over luckless Liverpool.
The Anfield outfit had recovered from the shock of conceding a second minute goal to Les Ferdinand to dominate proceedings after Ian Rush had nudged home their 11th minute equaliser. But they squandered a hatful of chances and when David James failed to hold Robert Lee's left-foot shot 30 seconds from time, Watson pounced to mark his first Premiership start of the season in perfect fashion.
"I am going to have a drink and try and console Roy Evans," said Keegan. "They have given us a lesson in football and deserved something out of the game. But my players never let their heads go down, even though some of them were having an absolute nightmare."
Keegan admitted: "If Roy had come across with 30 minutes left and offered us a 1-1 draw we'd have taken it and gone for a drink. But we kept in there and sometimes you get results from bad performances; those are the results that win you championships."
Keegan revealed that he had been on the brink of withdrawing Watson before he scored the winner. "I was going to substitute Steve but then I decided to leave him on. I suppose that's what you call great management! He would be the first to admit he had not had the best of games but he hung in there like the rest of them and that shows the spirit of Newcastle."
Liverpool boss Evans did not try to hide his complete disbelief that his side had ended up losing.
Offered a drink of tea, Evans quipped: "I need something stronger than that after that sort of game. I thought we were absolutely magnificent in the way we played but at the end of the day it's about winning matches. Some of the football we played was fantastic and showed that there is technical ability in this country. We had enough chances but we didn't take them. The players were sick in the dressing room afterwards and I'm gutted for them because they gave everything. It was a real kick in the teeth for us. In fact, I'd like to go through all the usual cliches only it was worse than that."
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