Stan Collymore plunged an injury-time dagger into Newcastle's championship heart to finish an unbelievable night in amazing fashion.
Newcastle had answered all the doubts over their championship nerves and looked to have ended their recent poor run when Faustino Asprilla took advantage of a David James howler to give them the lead for the second time.
Kevin Keegan's men, rocked by Robbie Fowler's second minute opener, had responded in a marvellous manner as a scintillating Anfield evening got better by the minute. Two goals in four minutes from Les Ferdinand and David Ginola put the Magpies in command, only for Fowler to claim his 35th goal of the season 10 minutes into the second half.
That was the cue for the James blunder, which allowed Asprilla to claim his third goal since his £7.5 million move from Parma, the South American poking into the vacant net.
But just as the travelling Toon Army were beginning to think in terms of drawing level with Manchester United with a game in hand, Collymore stole in to meet Jason McAteer's threaded cross and shoot home.
Then, in the second minute of added time, it was Collymore again, found in space by John Barnes, who poked home to set off scenes of wild abandon.
Newcastle, rightly applauded off the pitch by their fans, were broken, their hearts heavy as they trudged off.
Liverpool knew their own title hopes had been kept alive, but perhaps the biggest winner of the night was Manchester United manager Alex Ferguson. Steve Watson, scorer of the winning goals in both the clubs' meetings this term, came in to replace Warren Barton as Keegan withstood the temptation to re-introduce Keith Gillespie and played the team who finished the defeat at Arsenal 11 days ago.
Fowler had drawn a blank in those games, but after just 97 seconds he put that right as Liverpool exposed Watson's defensive shortcomings. Mark Wright played the ball down the Liverpool right and Fowler spread it wide before transferring to Jamie Redknapp. His long diagonal pass was knocked on first time by Rob Jones, Collymore nipped past Watson and when he crossed deep and Pavel Srnicek hesitated, Fowler's downward header bounced into the net. Anfield erupted, but Newcastle refused to wilt, showing the resolve of prospective champions.
Ferdinand jinked past two defenders before unleashing a swerving shot that James held, but when the England man struck for goal again in the 10th minute, James, so impressive against Aston Villa, turned villain. Neil Ruddock, fit after a knee injury, was also culpable, allowing Asprilla to sweep past him as he broke into the Liverpool box. The Colombian's pull-back from the right found Ferdinand in front of goal, but confronted by Wright. A touch gave him room to swing the right foot from eight yards, but while well-struck, James was squarely to blame as the ball brushed past his shoulder and through his hands.
Four minutes later Newcastle were ahead. Jones was too busy, concentrating on how to beat Watson to notice Rob Lee coming back, and a superb slide-tackle won the ball.
Ferdinand called for it on half-way, turned to his right to spot Ginola surging forward and with Wright mistiming his attempt to catch the Frenchman off-side, he was away and clear of Jason McAteer, slotting home his fifth goal of the campaign with arrogant ease.
Redknapp was a whisker away from rocketing in a 20-yarder and then Fowler, after Redknapp's free-kick dropped to him, slid the ball agonisingly wide. But with Lee and David Batty tenacious in midfield and Ferdinand and Peter Beardsley working overtime in tracking back, Newcastle looked to have the edge.
Steve McManaman did have a firm left-footer tipped over, but then Asprilla, latching on to Barnes' error, burst into the box before being felled from behind by the ex-England midfielder.
Newcastle's anger at referee Mike Reed might have been even greater if McManaman had headed at goal, rather than across it, from McAteer's centre a minute before the break.
Although Ruddock had struggled, Steve Harkness replaced Wright at the interval, but he had hardly found his feet when Lee raced past him into the box, only to be foiled by James.
Had the home keeper not intervened, there might have been no way back, but with the let-off giving them hope, Liverpool came again.
McManaman was twice denied, Fowler inadvertently turned John Scales' header wide, but in the 55th minute they were back on terms. McAteer's ball set McManaman in possession down the right and although the winger was losing his balance, he managed to play square along the 18-yard line, where Fowler came screaming in to drill home.
But then, almost instantly, came James' second aberration of the night -- a headlong rush from his line that turned a half-chance into a gift, Asprilla clipping past the stranded keeper after Lee and Beardsley had combined.
Batty, booked earlier for an ugly foul on McManaman, escaped with a warning after a spat with McAteer as chances came at both ends.
Fowler, McManaman and Collymore went close for Liverpool, Ginola just failed to find the unmarked Ferdinand, but then Collymore struck.
The drama did not end there either. Steve Howey was a fraction away from slicing McManaman's ball into his own net, Ferdinand was blocked by James and Srnicek's fingertips kept out Barnes.
But then, so cruelly for Newcastle, who did not deserve to lose, Collymore set Anfield alight. It summed up a night which will surely never be forgotten.
Stan Collymore grabbed the last-gasp strike that settled the finest game of the season by far and left Liverpool boss Roy Evans declaring: "Now we feel we've a realistic chance of the title."
The Anfield side had to win to maintain their hopes of overhauling Manchester United even though the victory left the Old Trafford side three points clear of Kevin Keegan's men.
Boosted by a second minute strike from Robbie Fowler, the FA Cup finalists were rocked by goals from Les Ferdinand and David Ginola before Fowler levelled with his 35th strike of the season.
Faustino Asprilla's third Premiership goal then looked to have tilted the balance back in Newcastle's favour before Collymore struck in the 68th minute then converted John Barnes' pass two minutes into injury time.
Collymore revealed Evans' half-time words had proved absolutely right. "The gaffer told us if we kept going we would win the game," said the former Nottingham Forest star. "We left it late. It was such an open game and there were chances galore. Both sides went for the win but fortunately we got it and it keeps the race wide open."
Victory closed Liverpool to within five points of their Wembley opponents, but the bookmakers reacted by trimming United's odds to 1-2, with Newcastle drifting to 2-1 and Liverpool in a couple of points to 8-1.
Even so, Evans maintained: "I am not interested in Manchester United or Newcastle. I'm interested in what's good for Liverpool, and this keeps us in the hunt. I didn't get much time to relax. It was a fantastic effort from both teams and a great game. But to be fair, it was kamikaze defending. Managers would be dead within six months if every game was like that." He added: "If either team had defended like that throughout the season they simply would not be in the position they are. But our attitude and will to win was fantastic."
"We're back in it now as genuine contenders. We're outsiders of the three but we're on the rails. We must keep doing well and not fall at the next fence."
Newcastle boss Kevin Keegan seemed not to know whether to laugh or cry at seeing his side show immense reserves of courage yet still finish up on the losing side of a night which will live long in the memory of all those privileged to witness it.
"It was a great game, but history will show we lost 4-3 and ended up with no points even though we had chances to win it. I'm not as disappointed as after we lost at Arsenal, but you can't be happy to have scored three away from home and still got nothing."
Keegan's faith in his side's attacking abilities did not deserve defeat. But while the Newcastle boss admitted Old Trafford manager Alex Ferguson would be perhaps most pleased by the result, he insisted his principles would not be altered. "I will carry on playing this way or I will go," he stated. "I don't know any other way. Maybe I don't feel as disappointed as I should as every player on both sides gave their all and made it into a classic. But in all my time as a manager I have never known a team play that well and not win." Keegan added: "If Robert Lee had scored at the start of the second half and put us 3-1 up it would have probably been game over. But Liverpool are made of pretty stern stuff. In the last five or 10 minutes they came on really strong. It reminded me of the Liverpool side 20 years ago and I'm sure it makes the Liverpool fans hope real glory is around the corner."
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