Wolves came from behind to check Chelsea's title aspirations with Pedro Neto scoring an injury-time winner in a 2-1 victory.
After a drab first 45 minutes where only a Kurt Zouma header that rocketed back off the crossbar threatened either goal, Olivier Giroud put Chelsea ahead (49) when his effort squeezed through Rui Patricio and was awarded by goal-line technology.
Although Frank Lampard has played down their title credentials, Chelsea were heading joint-top until Daniel Podence fired home a wonderful individual effort (66).
Wolves thought they had won a penalty on 81 minutes when Stuart Attwell felt Reece James tripped Neto inside the area but the referee reversed his decision after looking at the pitch-side monitor.
But Neto kept on driving Chelsea back and got his reward with one of the last kicks of the game as he fired a quality finish into the bottom corner (90+5).
The loss condemned Chelsea to their first back-to-back defeats in 2020 and leaves them three points off Liverpool and Tottenham having played a game more.
Wolves: Patricio (6), Saiss (7), Coady (7), Boly (7), Marcal (6), Semedo (7), Neves (7), Dendoncker (6), Podence (8), Silva (6), Neto (8)
Subs: Traore (7), Otasowie (7)
Chelsea: Mendy (6), Chilwell (7), James (6), Thiago (7), Zouma (7), Kante (7), Mount (6), Havertz (6), Werner (5), Pulisic (7), Giroud (7)
Subs: Kovavic (6), Abraham (6)
Man of the match: Pedro Neto
How Wolves left it late…
In what felt like the start of a pivotal week in terms of the season, both teams started in nervous fashion.
Chelsea saw their 17-match unbeaten run in all competitions ended by Everton on Saturday where they lacked fluidity in the final third and that was on show again.
Christian Pulisic was their main threat and it was his trickery that led to a corner on 21 minutes. From Ben Chilwell's superb delivery, Giroud rose highest about eight yards out but thumped his header over the crossbar with Patricio beaten.
- Wolves switched back to a back three with Willy Boly back in the team to join Conor Coady and Romain Saiss at the heart of the defence. Ruben Neves replaced the suspended Joao Moutinho in midfield.
- No rotation from Frank Lampard as he made just one change from the defeat at Everton with Christian Pulisic replacing Mateo Kovacic
Wolves - back in their regular shape with a back five - were happy to sit and soak up pressure and try to make the most of Neto on the counter. He stung the palms of Edouard Mendy from 20 yards but that was as good as it got for the hosts.
Patricio did not have a save to make but he was almost beaten a minute before the break when Zouma's towering header thumped the crossbar. The rebound hit Giroud a yard out and dropped wide as Wolves survived but they were breached just four minutes after the restart.
Giroud didn't have much service to work with but got half a yard when Willy Boly allowed a cross from Chilwell to bounce and the Frenchman was sharp enough to strike a volley that got through Patricio's grasp.
The ball squirmed over the line before the goalkeeper clawed it back, with goal-line technology awarding the opener.
Wolves responded well though and Fabio Silva had the ball in the net only to be denied by a correct offside call.
With Adama Traore now on the pitch, Wolves stepped up a gear as Chelsea had failed to build on the opener. They were punished after 66 minutes when Wolves levelled.
Podence always looked the most likely to inspire the hosts and the forward struck when he sold Chilwell and Reece James dummies before his shot clipped James and flew past Mendy at his near post.
It set up a frantic finish and Wolves thought they had a penalty with 10 minutes left after Neto went down under James' challenge.
There was minimal contact and referee Attwell reversed his own decision after checking the pitchside monitor.
Wolves sensed a Chelsea vulnerability and with Neto in confident mood, they broke quickly and got Neto one-on-one with Zouma. The Chelsea man backed off and Neto took full advantage, driving into the box and arrowing an effort into the far corner to get Wolves' season moving back in the right direction.
Man of the match: Pedro Neto
It was as if he was playing with the handbrake on until Wolves fell behind. Once at full throttle, Neto was Wolves' driving force up the pitch as his direct running gave Chelsea a big problem. His 22 sprints were the most made by any Wolves player. It was from one of his last bursts that the match-winning moment came. Chelsea backed off and allowing a player of his quality a free shot from 18 yards was a risky strategy that cost Frank Lampard's side dear.
What the managers said...
Nuno Espirito Santo: "It was a good performance after the situation that happened in the last minutes against Villa, when we played a good game but had a big blow at the end. That did not take away from how we played. We played a good game three days ago and a good second half today.
"Daniel Podence is a technical, talented player. He and Pedro Neto are doing well, evolving and trying to take up different positions on the pitch. With Raul [Jimenez] it was different and now with Fabio [Silva] it is different. It will require from us a lot of hard work. What we did today was good but it can only serve as an example of how we should proceed."
Frank Lampard: "I am disappointed to lose the game. We had it under pretty good control at the point of 1-0. I don't think we were playing brilliantly but we had control so we should have hung onto 1-0, control the game and control the counter attacks, which we didn't do.
"We were playing very well, with a long unbeaten run, but maybe the lads thought we were playing well. When you think you're playing well these things can happen. The players will need to think about their performance during the next few days. This is the Premier League, we need to do better."
- Chelsea have lost consecutive Premier League games for the first time since December 14, 2019.
- Each of Wolves' last 83 goals in the Premier League have been scored by non-British players (excluding own-goals) - only Arsenal have had a longer such run in the competition (171 between October 2005 - February 2008).
- Chelsea's opener came with their first shot on target of the game on 49 minutes.
- All four of Podence's Premier League goals for Wolves have come against London clubs (2 v Crystal Palace, 1 v Arsenal and 1 v Chelsea) with three of those four coming on home soil.
- Neto's strike for Wolves at 94:39 was the latest winning goal scored in a Premier League game against Chelsea since we have exact goal times in the competition (since 2006-07).
Wolves have a six-day rest period now before taking on Burnley next Monday, live on Sky Sports (5.30pm kick off). Chelsea are also back in action on Monday Night Football for a London derby with West Ham (8pm kick off).