Birmingham midfielder Wade Elliott stunned Premier League Wolves with a second-half winner to earn Chris Hughton's Championship side a shock 1-0 FA Cup third-round replay victory at Molineux.
The former Burnley player clinched a visit to Sheffield United in the fourth round with the deciding goal 17 minutes from time.
Victory gave Blues a measure of revenge after losing their top-flight status at the expense of Wolves on the final day of last season.
Hughton's main priority is to try to regain City's top flight status at the first attempt - and they are on the fringe of the play-offs.
But his side had already showed their resilience in the Europa League this season and this was their 36th game in a crowded schedule.
Blues were worthy winners, creating the better chances while Curtis Davies impressed in defence.
Brighton needed a penalty shootout to settle their FA Cup third-round replay against non-league Wrexham and earn a money-spinning clash against Premier League side Newcastle.
In the 20-year anniversary of their famous cup shock of Arsenal, Wrexham threatened to pull off another giant-killing through player-manager Andy Morrell's stunning strike midway through the first half.
But despite making most of the running, they could not find a second goal and Gus Poyet's side equalised on 77 minutes through Ashley Barnes to force a 1-1 draw and extra time.
After a scoreless extra 30 minutes, the game went to penalties and substitute Dean Keates' opening spot-kick was saved by Peter Brezovan, with the Seagulls netting all of their penalties to eliminate the Blue Square Bet Premier leaders 5-4.