The Hatters slipped to a first defeat in five matches at play-off rivals Huddersfield, with Jon Russell and sub Naby Sarr's second half goals enough to give the Terriers all three points.
The Hatters' top scorer Elijah Adebayo saw a penalty clip the outside of a post with 20 minutes to go as Nathan Jones' side strove to get back into the game at one down, but it was the west Yorkshire side who held on to move back up to third place, with Town remaining fifth.
Manager Nathan Jones made three changes to his team that appeared at Peterborough last Tuesday, captain Sonny Bradley returning to the starting line-up for the first time since January after recovering from injury.
Henri Lansbury started after coming off the bench at Posh, and Harry Cornick joined Elijah Adebayo up-front, with Cameron Jerome absent after sustaining an injury last week. Luke Berry was back on the bench, featuring in the matchday squad for the first time since the away win against Hull City in March.
Huddersfield had the first sight of goal inside the opening five minutes, but Lewis O'Brien's 20-yarder was always rising, and the Hatters soon settled into the game.
The men in orange enjoyed plenty of possession without threatening the hosts' goal, and it was Huddersfield who fired the next warning shot, this time from 25 yards out, but Jon Russell's attempt had the same end result with the ball ending up in the rows of empty seats acting as segregation between the home fans and the 1,000-plus travelling Hatters.
James Shea denied Danel Sinani with a smart save at his near post midway through the half, then two minutes later had to react quickly to gather a Sorba Thomas drive that took two deflections as it passed through the Town penalty area.
In between those saves Onyedinma had headed cross from O'Brien milimetres wide of his own post, with Terriers centre-half Tom Lees breathing down his neck as the home side looked to convert their pressure into a goal advantage.
The Hatters lost Mpanzu to injury after an innocuous looking challenge with O'Brien, with Robert Snodgrass coming on in his place, and it was the Scot who created the Town's first opening in the 36th minute, Cornick calling Lee Nicholls into action from outside the box, but the Huddersfield keeper saved well low to his right.
That would be the last meaningful action of the first half, with the scoreline remaining goalless at the break, but the Hatters came flying out of the traps in the second.
Bree's first cross was headed clear and Cornick couldn't connect with an attempted volley, but he teed up the former Aston Villa man for second delivery, this time whipped in and just an inch too high for Allan Campbell racing into the six-yard box.
Sinani had Huddersfield's first chance of the second half, a 20-yard piledriver that delected over for a corner, before Lansbury was forced off in the 58th minute with a neck injury sustained in a heavy challenge just after half-time.
Dan Potts came on in his place and the hosts' breakthrough came seconds later, Russell receiving a short throw-in from Pipa inside the Town penalty area and simply lofting a volley unchallenged and over Shea into the top corner.
Town thought they had found a way back in with 20 minutes to go, when Bree was tripped in the area by Sinani, but Adebayo dragged his penalty the wrong side of the post, clipping the woodwork as the ball made its way into the advertising hoardings.
Naismith and Onyedinma were booked in a scuffle that followed, along with Thomas for the hosts, and Adebayo was the architect of the Hatters' next chance, setting up Snodgrass for a shot that was way too high to trouble Nicholls with just over ten minutes to play.
Jones replaced Cornick with Danny Hylton on 81 minutes, and Amari'i Bell soon sent a left footer curling just wide, but it was Huddersfield sub Sarr who sealed the hosts' victory with a far post header from a deep Thomas corner.
Again the Hatters tried to rally, Bell once again driving forward and trying his luck, but this time his effort was too high and the game was up for Town.
Goals:
Huddersfield - Russell (59'), Sarr (89')