Their win, achieved despite the absence of their talisman Mo Salah, who is away at the Africa Cup of Nations, moved them into the fourth round draw and provided another huge boost to their confidence. The impetus in a season that once felt as if it would belong to Aresenal has shifted north to Merseyside.
Arsenal should have taken the lead inside two minutes. Aaron Ramsdale, restored to the starting line-up in this competition, launched a long kick up field in the direction of Reiss Nelson.
Ibrahima Konate watched it sail over his head as if he thought it would run on to Alisson but Nelson sprinted on to it and took the ball around the Liverpool goalkeeper. His touch took him wide, though, and when he tried to slide the ball in, he could only find the side-netting.
Arsenal soon went close again. Trent Alexander-Arnold dallied on the ball and Bukayo Saka stole it from him and raced into the box. He pulled the ball back and it fell to Martin Odegaard, who took a touch and then curled a shot past Alisson that crashed against the underside of the bar. Neither Kai Havertz nor Nelson could convert follow-up chances.
Liverpool offered precious little in reply until midway through the half when Darwin Nunez rose unmarked to meet a Harvey Elliott corner eight yards out but could only glance his header well wide. It is a familiar story for Nunez: he gets the chances but too often, he struggles to finish them.
It was only an interlude in Arsenal’s superiority and, after Saka had dazzled the Liverpool defence with his guile and footwork, the home side created another golden opportunity when Odegaard burst forward. He laid the ball into the path of Havertz but Havertz wanted too much time to steady himself and turned his shot on goal into a miskick.
Ben White stung the fingers of Alisson with a rising drive that the keeper tipped over and Havertz headed wide from a corner when he should have scored. On the touchline, Arteta watched on in undisguised disbelief. The air of frustration among the home fans grew and grew.
Jarell Quansah gave the ball away just before half time as he tried to play the ball out of the Liverpool defence but Havertz, once again, failed to make the most of the chance and Arsenal were nearly punished on the stroke of the interval when a sweetly-struck effort from the outside of Alexander-Arnold’s right boot cannoned off the bar.
Liverpool began the second half with the vigour of the reprieved. Alexander-Arnold lifted a brilliant pass into the path of Nunez and Nunez cut inside on to his right foot and unleashed a vicious shot that flew just wide of Ramsdale’s left hand post when many were expecting the net to bulge.
Arsenal unlocked the Liverpool defence with a clever free kick that freed Havertz on the left of the box. His chip across goal was begging to be converted but it just eluded the onrushing William Saliba and when it fell to Saka, he could only hook it over.
Ramsdale looked particularly dejected after Liverpool second goal of the game on Sunday
Declan Rice came close to scoring a header in the first half of the game but sent it just wide
It was a difficult night for Arsenal superstar Bukayo Saka, who struggled to get into the game
The result on Sunday evening has seen Mikel Arteta's side crash out of the FA Cup
Now it was Liverpool’s turn to waste chances. Nunez raced on to a brilliant through ball 20 minutes from time and bore down on Ramsdale. A more confident striker would have taken responsibility and gone for goal but Nunez hesitated and tried to pass the ball square to Luis Diaz. Diaz misread the pass. It went behind him and another opportunity was gone.
Ramsdale produced the save of the game to push a shot from Diaz round the post 15 minutes from time. From the resulting corner, Diogo Jota leapt highest and beat the Arsenal goalkeeper with his header only to see it rebound off the crossbar.
Liverpool kept up the pressure. They got a free kick near the corner flag and Alexander-Arnold stood over it. There are few players who are better with the dead ball than the Liverpool captain and when he bent the ball in with pace, Jakub Kiwior tried to head it clear but could only deflect it past Ramsdale to put Liverpool ahead.
Arsenal launched a desperate search for an equaliser but when Liverpool broke again deep into added time, Diaz found space on the right side of the Arsenal box and smashed a shot high into roof of net to seal the tie.
Arsenal are five points of City in the league, out of the League Cup and out of the FA Cup
Meanwhile, Liverpool will progress through to the next stage of the competition
With Virgil van Dijk missing from the squad, Konate was forced to take control of the backline