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Manchester United's top four bid suffered another blow as Southampton hit back to earn a 1-1 draw, while Everton boosted their bid for Premier League survival with a vital 3-0 win against Leeds on Saturday.
Ralf Rangnick's side took the lead through Jadon Sancho's first Premier League goal at Old Trafford.
But, for the third consecutive game, United failed to build on their lead and were punished when Che Adams slotted in off the inside of the post two minutes into the second half.
United are level on points with fourth placed West Ham, but Arsenal are just a point behind with two games in hand, while Tottenham have played three fewer games and are four points back.
Cristiano Ronaldo was recalled by Rangnick after being dropped to the bench for a disappointing 1-1 draw at struggling Burnley on Tuesday.
But Ronaldo's goal-drought extended to six games as United produced yet another erratic performance.
Rangnick had to cope with more leaks in the press this week that the United players are unhappy with his coaching techniques.
The interim boss admitted United need to play with more aggression if they are to keep their top four hopes alive.
"It was the third game where we were 1-0 up and I don't think anyone out there should believe that the players don't care," Rangnick said.
"The question is with the group of players we have, how do we get more compact, more aggressive and even more nasty, it's about defending a lead.
"This is the major issue but it's not a question of the players not wanting to do that."
At Goodison Park, Everton moved five points clear of the relegation zone with their first top-flight win under Frank Lampard.
Lampard's side, who beat Brentford in the FA Cup in their new manager's debut, took the lead in the 10th minute when Seamus Coleman met Donny van de Beek's cross with a close-range header.
- Everton cruise -
It was Coleman's first goal in 80 games in all competitions stretching back to 2019.
That landmark moment was followed by another rare goalscorer as Everton defender Michael Keane headed in from Anthony Gordon's 23rd minute corner for just his second goal this term.
After suffering a damaging defeat at relegation rivals Newcastle in his first league game in charge, former Chelsea boss Lampard was able to celebrate three valuable points when Gordon got the final touch on Richarlison's shot in the 78th minute.
Leeds are only one point above Everton after a third successive game without a win.
Second bottom Watford are deep in relegation trouble after a 2-0 defeat against Brighton in new boss Roy Hodgson's first home game in charge.
Brighton struck in the 44th minute when Neal Maupay hooked a superb half-volley into the top corner from Tariq Lamptey's cross.
Watford were booed off at half-time and there were more jeers at the final whistle after Adam Webster sealed the points from close-range after a goal-mouth scramble.
Watford have lost 10 of their last 12 games and are yet to score in three matches under Hodgson.
The Hornets remain three points from safety as Hodgson tries to mastermind another escape act, having previously saved Crystal Palace, Fulham and West Brom from relegation.
Brentford shared a 0-0 draw with Crystal Palace as Christian Eriksen was introduced to Bees fans on the pitch before kick-off.
Denmark midfielder Eriksen is back in training and hopes to return to action soon for the first time since his cardiac arrest during a match against Finland at last year's European Championship.
W.F.Portman--NZN