Ashley Williams's 86th-minute header ended Arsenal's 14-game unbeaten run and kept Arsene Wenger's side from the Premier League summit as Everton claimed a much-needed 2-1 win on Tuesday.
Arsenal would have provisionally supplanted leaders Chelsea on goal difference with victory and took a 20th-minute lead when Alexis Sanchez's free-kick deflected in off Williams.
But Seamus Coleman equalised with a 44th-minute header before Williams's first Everton goal ended his side's five-game winless run and sent Ronald Koeman's men up to seventh in the table.
Meanwhile, champions Leicester City were brought down to earth after their 4-2 demolition of Manchester City as Marc Pugh's goal earned Bournemouth a 1-0 win at the Vitality Stadium.
Arsenal made only one change from their 3-1 win over Stoke City, fit-again right-back Hector Bellerin replacing injured centre-back Shkodran Mustafi, and took a 20th-minute lead.
The goal stemmed from a comedy of errors on the edge of Everton's box as Ross Barkley lost possession, Williams fouled his own team-mate Idrissa Gueye and Phil Jagielka tripped Francis Coquelin.
Sanchez sent the free-kick curling towards Everton goalkeeper Maarten Stekelenburg and in seeking to clear the ball, Williams succeeded only in deflecting it into his own net.
It was Sanchez's 12th effort of the campaign, putting him level with Chelsea's Diego Costa as Premier League top scorer.
Everton did not look like equalising, with Romelu Lukaku and Aaron Lennon slicing shots off target, but with half-time looming they drew level.
Leighton Baines curled a right-foot cross towards the back post from the left and Coleman nipped in between Laurent Koscielny and Nacho Monreal to glance a deft header past Petr Cech.
Mesut Ozil spurned a glorious opportunity to restore Arsenal's lead early in the second half, wafting a shot over the bar from Sanchez's cut-back, while Barkley drilled wide at the other end.
The noise level rose as the game wore on and with four minutes to play Everton struck the winner, Williams flying in at the back post to send a thudding header past Cech from Barkley's corner.
Everton had Jagielka sent off after he picked up a second yellow card in stoppage time, but the hosts survived despite a late scare that saw Arsenal substitute Alex Iwobi have a shot blocked on the line.
It was Arsenal's first league defeat since their 4-3 loss to Liverpool on the season's opening day and kept them three points below Chelsea, who visit bottom club Sunderland on Wednesday.
Leicester remain without back-to-back league wins this season after a defeat at Bournemouth -- their eighth of the campaign -- kept them in 14th place, just four points above the relegation zone.
Pugh marked his first start of the season with the game's only goal, slamming home the rebound after Leicester goalkeeper Ron-Robert Zieler saved from Benik Afobe in the 34th minute.
Eddie Howe's Bournemouth leap four places to eighth, nine points clear of the bottom three.
AFP
Tue Dec 13 2016
Ashley Williams is mobbed by teammates as he celebrates scoring his team's second goal during the English Premier League football match between Everton and Arsenal at Goodison Park in Liverpool, on December 13, 2016. / AFP PHOTO
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