Nottingham Forest moved up to fifth in the Championship after a win that ended second-placed Leicester's unbeaten record at the King Power Stadium.
Simon Cox opened the scoring from close range against the run of play after Jamie Paterson's shot had been blocked.
Forest doubled their advantage before the interval - Jamie Mackie finding the net after Danny Drinkwater had cleared Henri Lansbury's effort off the line.
Leicester were wasteful and David Nugent missed a second half penalty.
Forest end eight years of hurt
Nottingham Forest had failed to win on their previous five visits to Leicester since Gareth Taylor scored the only goal of the game on 5 March 2005.
It was awarded after David Vaughan, on loan from Sunderland, brought down Drinkwater.
But former Portsmouth striker Nugent had a poor game and blazed over the bar having earlier wasted two good chances when the game was goalless.
Lloyd Dyer also spurned a glorious opportunity as Leicester failed to take their chances in a bruising east Midlands derby.
The hosts should have been 2-0 up in a lively opening 15 minutes that saw two Foxes players, Marcin Wasilewski and Anthony Knockaert, booked.
Knockaert quickly redeemed himself after being cautioned for urging referee Lee Mason to book Forest's Jamaal Lascelles for a foul on Jeff Schlupp - the midfielder's free-kick allowing Nugent to test keeper Karl Darlow.
Former West Bromwich Albion winger Dyer then fired into the side netting after more good work by Knockaert before Nugent headed another great chance over the bar.
It proved a costly miss as Forest took control with two goals in 12 minutes before the interval.
They opened the scoring with their first serious attack, a delightful pass by Andy Reid carving out a 31st-minute opening for Paterson, whose blocked shot fell to Cox to tuck home.
Having wasted a string of early chances, Leicester were suddenly under pressure.
Lansbury produced a fine save from Foxes keeper Kasper Schmeichel before Mackie doubled the lead.
The ball fell kindly to the former QPR forward who made no mistake after Lansbury had been denied by a Drinkwater goal-line clearance.
Schmeichel at full-stretch prevented Paterson from inflicting further damage after the break, before Nugent's missed penalty summed up a day to forget for Leicester.
Leicester manager Nigel Pearson:
"We didn't do well enough in either box is the most succinct way of putting it.
"They didn't create very much but we conceded two goals. We were a bit unfortunate with the first but could have done a bit better with the second.
"And we spurned a number of good chances. So it's unfortunate for us. We have been guilty of not being efficient enough in either box. That is the bottom line."
Nottingham Forest boss Billy Davies:
"I enjoyed it because it was a very important three points. But it's only three points, and there is no point at this stage of the season getting too down or too excited if you are in or out of the top six.
"I'm just delighted as a manager to see the players take on board what they worked on last week.
"We worked very hard on the shape of the team and the tactics and the strength and weaknesses of the opposition."
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