TWO-GOAL Peter Odemwingie spearheaded a stunning second-half fight-back as Albion well and truly earned the first local derby bragging rights of the season.
Blues stunned the home crowd by taking a 15th-minute lead through Cameron Jerome's tap-in - their first effort at goal.
Despite the Baggies enjoying most of the possession, that's how the score remained at half-time.
However, Albion snatched the spoils and ended City's unbeaten start to the season thanks to three goals inside 18 minutes.
Odemwingie bagged his second and third of the season in the 51st and 59th minutes respectively before Jonas Olsson headed Albion's third on 69.
It was a richly-deserved second&nbsp;Hawthorns win of the season for Roberto Di Matteo's men who controlled the game for long spells to preserve their eight-month unbeaten home league record.
Di Matteo named an unchanged team for the first meeting between the neighbouring clubs in four seasons.
The Baggies boss opted for the formation that finished last Saturday's draw against Tottenham, as Odemwingie played just behind frontman Marc-Antoine Fortuné.
Graham Dorrans returned to the bench in place of Simon Cox after missing last week's game through a family bereavement.
Alex McLeish made one enforced change, with Alexander Hleb handed his debut in place of the injured James McFadden.
There was a typically cagey start to this West Midlands derby as both teams sized each other up.
In fact, it wasn't until the 14th minute that the first shot of the game arrived.
The impressive Jerome Thomas made the most of a fortunate ricochet off Roger Johnson as he charged down the left before cutting the ball back across the box to Odemwingie.
The Nigeria international pulled the trigger from 15 yards but his scuffed effort was easily gathered by Ben Foster.
However, just a minute later, Blues made the most of slack Baggies defending to break the deadlock.
Scott Dann was left unmarked at the back post to head Sebastian Larsson's angled free-kick across the face of goal and Jerome poked the ball home from a yard.
Albion regrouped and soon created another decent chance.
On 21, Chris Brunt found space down the right and whipped in a terrific cross which fell perfectly for Paul Scharner at the back post.
The slightly off-balance midfielder poked the ball goalwards, only to be denied by Foster's reaction save.
Albion continued to keep Blues pegged back and it took an important block by Dann to prevent Odemwingie's 20-yard volley troubling Foster's goal.
Moments later, the England international keeper was well positioned to clutch Brunt's towering header from Thomas' centre.
Blues did not record another effort at goal until the 34th minute when Scott Carson had little trouble catching Craig Gardner's 20-yard strike.
Albion spent the rest of the half prodding and probing but were unable to find a way through the red defensive wall.
On 42, Johnson was relieved to see his attempted clearance bounce just wide of the far post from Fortune's header across the face of goal.
Gabriel Tamas then leapt at the back post to powerfully head Brunt's left-wing corner just wide.
Di Matteo made a change at half-time, bringing on Dorrans for Fortune.
And the move paid instant dividends.
The second half was only six minutes old when Dorrans slipped Thomas inside Stephen Carr and the winger did brilliantly to hold off the ex-Newcastle defender before seeing his low cross flicked home by Odemwingie inside the six-yard box. There was a suggestion that Dann had got the last touch - but Odemwingie is claiming it for now.
The Hawthorns was now a cauldron of noise but Odemwingie couldn't add a second three minutes later when his ambitious chip from an acute angle sailed over Foster's bar.
The game had opened up but Gardner failed to trouble Carson with a 25-yard drive which trickled wide of the far post.
Jerome was just as wayward when he lashed Hleb's clever back-heel off target from 20 yards.
But Albion turned the game on its head by snatching a 59th-minute lead.
Odemwingie pounced on Lee Bowyer's misplaced pass into his own box in a flash and rounded Foster before slotting home from an acute angle through Dann's legs.
The buoyant Baggies were in dreamland ten minutes later when Olsson incredibly made it 3-1.
Brunt swung a terrific corner to the back post and the Swede towered above Liam Ridgewell to headed powerfully past Foster.
Blues were now a beaten team and if anyone was going to add to the scoring again, it looked like Albion.
Three minutes from time, Dorrans, whose emergence at half-time had changed the game, fed Thomas who ran at the Blues defence before curling just wide from 18 yards.
Foster was called into action a final time when he dived low to his right to clutch Gonzalo Jara's 30-yard daisy-cutter.
The final whistle brought the curtain down on a terrific comeback and was greeted by raucous cheers from the home hordes.
ALBION (4-4-1-1): Carson; Jara, Tamas, Olsson, Shorey; Brunt, Scharner, Mulumbu (Reid 75), Thomas (Barnes 87); Odemwingie; Fortuné (Dorrans HT). Subs not used: Myhill (gk), Bednar, Ibanez, Tchoyi.
BLUES (4-4-1-1): Foster; Carr, Johnson, Dann, Ridgewell; Larsson, Gardner, Ferguson, Bowyer (Zigic 68); Hleb (Beausejour 83); Jerome (Derbyshire 80). Subs not used: Taylor (gk), Murphy, Michel, Fahey.
GOALS: ALBION - Odemwingie (51 &amp; 59), Olsson (69). BLUES - Jerome (15).
BOOKINGS: ALBION - Odemwingie (over-celebrating 59). BLUES - Bowyer (foul 67).
REFEREE: C Foy (Merseyside).
ALBION STARMAN: Peter Odemwingie.
PIC: POINTING TO VICTORY...Odemwingie celebrates his first goal&nbsp;
&nbsp;To buy a DVD copy of this game for just &pound;4.99, plus postage, click here.