Clinton Morrison gave the Blues a first-half lead but a bizarre own goal by goalkeeper Peter Enckelman destroyed Villa, before substitute Geoff Horsfield notched the third goal.
In a heavily charged atmosphere both teams were intent on attack in an attempt to gain the upper hand and it was Birmingham who emerged worthy winners to leave huge question marks against Villa's performance.
As the game settled down it was newly promoted Birmingham, unbeaten in their previous three games, who began to look the more dangerous.
Aliou Cisse ran on to a clever pass from Morrison, but blasted his effort over the bar, while skipper Jeff Kenna's header from Martin Grainger's corner was also wide of the target.
It was the start of some consolidated attacking play by Birmingham with Villa's experienced defenders finding themselves under a great deal of pressure.
Villa finally wilted in the 31st minute when Kenna put over a floated cross which found Robbie Savage, who knocked the ball into the path of the unmarked Morrison to fire his right-foot shot past Enckelman.
A few minutes later Villa very nearly grabbed an equaliser when Ulises De la Cruz blasted a 30-yard angled shot against the crossbar.
But Birmingham were in full flow and only some dogged defensive work by Alpay prevented Morrison adding to his tally.
The speed of Morrison and Stern John contrasted sharply to Villa's ineffective strikeforce of Juan Pablo Angel and Marcus Allback.
This resulted in manager Graham Taylor making a double substitution at half time sending on fellow strikers Darius Vassell and Dion Dublin.
The result was a more positive attacking formation from Villa and Vassell had the ball in the net just before the hour only for the goal to be disallowed for offside.
This proved to be a crucial turning point as Villa's goalkeeper Enckelman, casually attempted to clear a throw-in from Olof Mellberg. The ball touched the keeper's boot and went in for a bizarre own goal.
Substitute Horsfield added the third when he raced on to a Savage pass to score past a bemused Enckelman