GARETH McAuley's dramatic late winner stretched awesome Albion's winning run to three games - and secured the club's first-ever Barclays Premier League points against Chelsea.
The Northern Ireland international turned in Liam Ridgewell's volley eight minutes from time as the Baggies won three games on the trot at this level for the first time in nine seasons.
The hard-earned victory - ending 11 straight defeats against the West Londoners in the Premier League - was no less than Roy Hodgson's men deserved, having matched their illustrious neighbours all over the park.
And a second successive clean sheet was the icing on the cake as Albion surged up to ninth and opened up a 13-point gap on the bottom three.
Roberto Di Matteo was afforded a warm pre-match reception from the home fans as he took to the away technical area. The former promotion-winning head coach was making his first return to the club, in his new role as Andre Villas-Boas' assistant first-team coach, since his departure from The Hawthorns a year ago.
Both bosses named unchanged teams and the only alteration to Hodgson's squad was on the bench, where fit-again club captain Chris Brunt and Gabriel Tamas replaced Somen Tchoyi and Craig Dawson.
Chelsea's hopes of securing a coveted Champions League place suffered a pre-match set-back when fourth-placed Arsenal, the team they had trailed on goals scored, won at Liverpool in the day's early kick-off.
Albion started positively and, in the seventh minute, skipper Jonas Olsson saw a free header from James Morrison's angled free-kick blocked on the edge of the West Londoners' six-yard box by Didier Drogba.
Seconds later, Petr Cech was called on to make his first save of the match when he jumped high to his left to palm over Morrison's swirling 25-yarder from Jerome Thomas' lay-off.
Chelsea threatened for the first time on 11 when Daniel Sturridge seized on Olsson's misplaced pass and crossed to Juan Mata, who failed to make proper contact with an inviting 15-yard volley.
The visitors carved out another half-chance three minutes later when Ramires and Drogba combined to set up Mata, whose acute shot was palmed wide at his near post by Ben Foster.
Albion only half-cleared Mata's ensuing corner and Michael Essien saw his ferocious shot from the edge of the box crash into Steven Reid's midriff and fly clear.
The Baggies were soon back on the attack and Marc-Antoine Fortune dragged his shot wide from 12 yards after Gary Cahill had directed Ridgewell's cross straight to the lone striker.
On 19, Peter Odemwingie, yesterday named the Barclays Premier League Player of the Month for February, found space just outside the Chelsea penalty area, only to shoot harmlessly past the far post.
Albion were giving as good as they were getting but they owed a debt to Morrison on 27 when Frank Lampard's corner fell neatly for Cahill 12 yards out. The former Bolton defender's goalbound effort struck Morrison on the forehead and bounced clear.
The Baggies began to rebuild some momentum towards the end of the half but Keith Andrews couldn't direct his near-post header towards the target from Morrison's flag-kick.
However, Foster had to pull off the save of the half on 39, diving full stretch to his left to claw away Essien's 25-yard pile-driver before bouncing back up and clutching the loose ball in the nick of time as Branislav Ivanovic looked to pounce.
In an end-to-end finale to the half, Andrews looked set to score as Ridgewell clipped over a terrific far-post cross, but Cahill and David Luiz combined to sandwich the Ireland international in mid-air and take the sting out of his header, which was easily cleared.
But Albion had a real let-off on 42.
Drogba found Sturridge in the clear with a sweeping right-wing ball. The England striker's first-touch was poor as it took the ball behind the recovering Reid, but he swivelled and fired goalwards, only to drag his shot wide of the beaten Foster's far post from 12 yards.
There was one more moment of danger - at the Chelsea end.
Youssouf Mulumbu strode onto Ridgewell's pass and shrugged off Ramires before seeing his goalbound curler from just inside the box clip Cahill and loop wide.
After a slow start to the second half, Odemwingie had a shot blocked inside a crowded goalmouth before the Baggies suffered an injury blow.
Reid crashed to the ground after gifting possession to Mata on the halfway line and had to be helped off the field by the club's medical staff.
From the same incident, Mata put Sturridge clean through with a wonderful cross-field ball, but Foster raced out of his area to dispossess the former Manchester City man and clear Albion's lines.
The action swung to the other end and after Ashley Cole made a hash of a headed clearance from Ridgewell's centre, Marc-Antoine Fortune stung Cech's hands with an angled 18-yard effort.
It wasn't until the 62nd minute that Chelsea recorded another shot at goal, and Mata was wayward with a left-footed strike from 20 yards.
Albion were forced to make another change on 64 when Brunt, making his first appearance since fracturing his ankle on New Year's Day, replaced Thomas.
Seconds later, Ridgewell had to take evasive action to prevent Mata getting on the end of Drogba's pull-back, denying Chelsea's summer signing from Valencia a clear sight of goal.
But Albion went mightily close to snatching a 67th-minute lead.
After Brunt's corner had only been half-cleared, Mulumbu tested Cech with a 25-yard volley which the Czech international did well to tip over.
The Baggies were now on top and Cech had to make another fine save low to his left to push away Fortune's low drive from 20 yards.
Brunt started and almost finished Albion's next move, spreading the play to Ridgewell before racing into the box and being denied a diving header on the edge of the six-yard box by Cole's outstretched boot.
From Brunt's ensuing corner, Ridegwell rose highest at the near post to flick the ball onto the roof of the net.
The Northern Ireland midfielder was enjoying a lively return to action and he fizzed a tremendous 30-yard effort just wide on 76.
Albion got the goal they had been threatening eight minutes from time.
Brunt's corner found its way to Andrews at the far post and from his dink back into the danger-zone, Ridgewell saw his volley turned in by McAuley. Cue delirium in the home sections.
Cech had to make a fine save to prevent Andrews making it 2-0 four minutes later, diving low at his right-hand post to turn wide the ex-Blackburn man's 18-yard volley.
Albion had a let off in the second minute of stoppage time when Lampard ghosted onto Cole's cross and steered his volley just wide of the far post.
Mata saw an even later shot fly wide - but Albion weren't to be denied a second home win inside a week.
ALBION (4-5-1): Foster; Reid (Tamas 57), McAuley, Olsson (c), Ridgewell; Odemwingie, Mulumbu, Morrison, Andrews, Thomas (Brunt 64); Fortune (Long 84). Subs not used: Fulop (gk), Dorrans, Cox, Shorey.
CHELSEA (4-5-1): Cech; Ivanovic, Cahill, Luiz, Cole; Sturridge (Malouda 63), Mata, Essien (Torres 77), Lampard (c), Ramires (Meireles 85); Drogba. Subs not used: Turnbull (gk), Romeu, Mikel, Hutchinson.
GOALS: ALBION - McAuley (82).
BOOKINGS: ALBION - Andrews (foul 79), Brunt (foul 90+4). CHELSEA - Cole (foul 85).
REFEREE: P Dowd (Staffordshire).
ALBION STARMAN: Youssouf Mulumbu.