Town's U18s beat their Arsenal counterparts 1-0 at Portman Road on Thursday evening. Almost 2,000 fans witnessed Jack Ainsley's second half penalty which won the game, which was sponsored jointly by former Blue Kieron Dyer and Supporters Trust secretary Colin Kreidewolf.
Town were without striker Jordan Rhodes who is currently on loan at Oxford United, but Ed Upson was named on the bench after playing 78 minutes for England's U19s on Wednesday night.
The early stages saw Ainsley have a shot well saved by Polish keeper Wojciech Szczesny and Jai Reason also have a freekick gathered by the Gunners number one.
Sanchez Watt almost gave the visitors the lead after 11 minutes when Town keeper Andy Plummer was caught out of position, but Tommy Smith got back to stop the ball bouncing into the unguarded net.
Rui Fonte and Henri Lansbury both squandered good chances for the visitors, whilst Reason's shot from the edge of the box flew over the Arsenal bar.
On 36, Watt failed to convert another good chance from six yards out, following good work from Nacer Barazite on the right.
Town started the second half with a little more purpose about their play and Craig Calver saw a left-footed shot fly over the bar on 53. A minute later,Calver was replaced by Ed Upson.
Fonte was the next Gunners man guilty of missing a decent chance when he blazed over Plummer's bar after being put through by a ball over Town's defence.
Town came close to opening the scoring on 65 when a Paul Murphy corner was headed down by Smith before being flicked towards goal by Ainsley, who saw his effort tipped over the bar by Szczesny.
Scottish centre-back Paul Watson then came close to putting through his own net when he diverted a Jay Thomas cross just wide of the post for a corner.
Arsenal's James Dunne was then booked for dissent after challenging referee Watson following a fair block tackle from Upson.
The visitors then made a double substitution, with Cedric Evina replacing Rene Steer at left-back and Emmanuel Frimpong coming on for Dunne in midfield.
Against the run of play, Town scored in the 74th minute. In a rare venture into the Gunners penalty area, a foul on Ainsley by Paul Rodgers led to the referee pointing to the spot.
Ainsley grabbed the ball and hit his penalty into the bottom right corner, sending Szczesny the wrong way.
Luke Ayling replaced Rodgers soon after, with the Gunners centre-back struggling with cramp.
Town made their second change when Liam Barrett replaced Murphy and late on, Luke Hyam taking over from Kurt Robinson, who was also struggling with cramp.
The Blues played out the remainder of the game plus the four minutes of stoppage time to record only their second win of the season and stop Arsenal's unbeaten start to 2007/08.
Ipswich U18s: Plummer, Clemo, Robinson (Hyam 90), C Williams (c), Watson, Smith, Murphy (Barrett 80), Reason, Ainsley, Calver (Upson 54) and Fenn. Unused: Ward and Lambe.
Arsenal U18s: Szczesny, Ogogo, Steer (Evina 70), Dunne (Frimpong 72), G Hoyte (c), Rodgers (Ayling 76), Lansbury, Thomas, Watt, Fonte and Barazite. Unused: Eastmond and Blackwood. Ref: M Watson. Att: 1,986.
Report by James Ager.