Blackburn, still clinging to the faint hope of a place in Europe next season, gave Kenny Dalglish revenge for the defeat they suffered at the hands of his old club earlier this season.
Kevin Gallacher, making his debut after his deadline-day move from Coventry, was among the scorers as Blackburn manager Dalglish saw his team build a handsome victory.
Liverpool boss Graeme Souness, Dalglish's old Anfield team mate, was on his feet protesting that Blackburn's opening goal was offside, but after that he could have had few complaints.
Mike Newell was first on the scoresheet after 13 minutes, popping up at the far post to find the net from Gallacher's cross.
Rovers skipper Kevin Moran showed astonishing athleticism for a man coming up to his 37th birthday when he added a second in the 25th minute.
Gordon Cowans' corner kick brought a Newell drive bravely blacked by keeper David James whose luck was out when the ball fell for Moran to score with a spectacular bicycle kick.
Four minutes before the break Blackburn went three up when David May's long punt from defence found the Liverpool defence at full-stretch and Gallacher got on the end of a cross from Jason Wilcox.
Within a minute Ian Rush hit the bar with a drive and was first to the rebound with a header which Bobby Mimms saved with some difficulty.
Souness must have agonised at the ease with which Wilcox was able to hold off a double challenge to run on and score Blackburn's final goal in the 65th minute.
The only consolation for Liverpool was a typical strike six minutes from time by Ian Rush, pivoting on a sixpence and volleying in style into the roof of the net.
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