It had started so well for the hosts with youngster David Ngog firing them into an early lead.
But Ecuadorian Christian Benitez's nodded equaliser and Cameron Jerome's thunderous 35-yarder had Birmingham ahead at the break.
And only a hotly-contested spot-kick - which TV replays showed should not have been awarded as Lee Carsley made no contact with Ngog with his attempted tackle - gave Liverpool their lifeline, Gerrard sliding it home.
Fernando Torres did not even get a substitutes' role, the Spain striker now clearly being given a lengthy rest to recover from his groin problem.
Gerrard, with a similar if less severe injury, was named on the bench along with Alberto Aquilani.
Glen Johnson, Albert Riera and Martin Skrtel all returned from injury, with Jamie Carragher suspended.
Birmingham had Joe Hart back in goal while they were without Barry Ferguson, also suspended, so Teemu Tainio came into the side.
Liverpool went with the 20-year-old Ngog up front and Dirk Kuyt, captain for the night, in a central supporting role.
Of all Liverpool's young imports, Ngog has looked the most likely to make the breakthrough this season, and his balance and clever control were soon in evidence.
Hart saved one Ngog effort before the France Under-21 striker gave Liverpool a 13th-minute lead. Johnson surged down the right, cutting between two defenders before crossing for Ngog who saw his first effort blocked by Hart.
The ball flew to Kuyt only for Hart to again get his legs in the way, but when the rebound dropped for Ngog he made no mistake with a fierce a close-range volley into the roof of the net.
Tainio limped of two minutes later, former Everton midfielder Carsley coming on in his place.
Liverpool had been cruising up till now, but Birmingham struck back with an impressive set-piece, and once again Liverpool's susceptibility in the air was evident.
James McFadden fired a free-kick into the area and Roger Johnson headed back across goal where Scott Dann nodded on for Benitez to head past Jose Reina from close range.
Hart touched over a Javier Mascherano drive, and Daniel Agger saw a low shot following a corner kicked off the line by Carsley as Liverpool tried to hit back.
A minute from the break Riera, who had appeared to be on a solo bid to score from outside the box at almost every opportunity, suffered a recurrence of a hamstring injury, and Gerrard was brought into the fray as a substitute.
His arrival was met with huge cheers from the Kop, but the home crowd was silenced within seconds as Birmingham took the lead.
Jerome shook off the attentions of Mascherano to lash a swerving 35-yard effort into the roof of the net.
The confidence Liverpool had shown in the first half hour evaporated and, with the crowd's anxiety growing, errors in possession increased.
Gerrard saw a low header hit Hart's left-hand post from Johnson's cross from the right as Liverpool at last produced some sustained pressure.
McFadden was booked for a foul on Johnson, the Scot being substituted soon after to be replaced by former Red Gregory Vignal.
Liverpool were then awarded the highly-contentious 71st-minute penalty.
Ngog did well to get to the byline and went sprawling to the turf as Carsley came in with a sliding challenge, even though the Birmingham man's leg did not touch the Liverpool youngster.
Carsley and Ngog exchanged views and pushes, and referee Peter Walton booked both before Gerrard stepped up to drill home the spot kick.
Liverpool then lost Benayoun with a hamstring complaint, Ryan Babel coming on.
Gerrard fired over a cross for Ngog to hit wide at the near post before sending an 18-yarder just wide.
With nine minutes left Aquilani finally made his Anfield debut as a substitute for Lucas.
The visitors were forced to defend desperately in the final minutes and hung on valiantly for a point.