Town's good run of form on the road came to an end as an impressive Swansea comfortably won 3-0 at the Liberty Stadium. Jason Scotland scored twice before a brilliant Jordi Gomez freekick with Alan Quinn coming closest for the Blues.
As expected, Kevin Lisbie returned to the starting line-up in place of Pablo Counago, while Quinn came in for Jon Stead. Jon Walters switched to right midfield as Town started with a 4-5-1 formation
The home side went ahead with the game's first serious penalty area action. Garvan and then Balkestein failed to stop Albert Serran from sending in a cross from the right and Scotland got ahead of Gareth McAuley to slam the ball past Richard Wright.
Again, Town had started slowly and the Swans dominated the first half hour, although Lisbie had the ball in the net in the 12th minute, but after a linesman's flag had been raised.
Wright saved comfortably from Ashley Williams, Scotland and then Leon Britton with the home side giving the Blues a lesson in passing and moving, while Town surrendered possession all too easily.
On 35 Scotland got behind Balkestein inside the area, but the Dutchman got back to challenge the Trinidad and Tobago international as he unleashed a shot which would probably have doubled his side's lead.
Town switched to 4-4-2 with Walters joining Lisbie up front and, as the game moved into the last 10 minutes of the first half, the Blues started to come into it more. In injury time, David Norris, who moments earlier had been booked for a foul, shot just over the crossbar from the edge of the area after a break.
While the Blues had come more into the game in the closing minutes of the half, the home side were well deserving of their lead. Town had been very much second best with the Swans looking the more composed and more dangerous side.
The uncharacteristically quiet Jon Walters was replaced by Pablo Counago at the break, the Spaniard joining Lisbie up front.
Town started the second period strongly and in the 51st minute Counago played in Norris on the left of the area, but the former Plymouth man sent his shot across the face of goal.
Four minutes later, Tommy Miller hit a well-struck shot just wide of Dorus De Vries's post after a layback from Counago.
Alan Tate was yellow-carded for the latest in a succession of fouls on Alan Quinn, who had angered home fans by catching a Swansea player with an arm, although the contact appeared to be accidental.
Mark Gower shot over from 25 yards in the 58th minute, then shortly afterwards Jordi Gomez was found in space on the edge of the area, but his strike was too close to Richard Wright.
Town had lost their early second half impetus and on 66 Danny Haynes replaced the ineffective Owen Garvan, Quinn moving into the centre to allow the sub to take up the right midfield position.
Quinn was booked for diving by referee Kevin Wright, although the Irishman appeared to have been clipped by Garry Monk. Town had been given little by the officials all afternoon with a number of very debatable offside flags against Counago and Lisbie in the second half.
Wright claimed Gomez's weak effort, prior to the home side adding to their lead. The ball was played in to Scotland's feet inside the box, the striker took a couple of touches before hammering a shot on the turn which gave Richard Wright no chance.
There appeared little chance of Town getting anything from there with one goal looking unlikely, let alone two.
Jon Stead replaced David Norris for the final 16 minutes and soon after got to the byline but his ball to the near post was bundled away from Lisbie by a defender with keeper De Vries clearing up.
Town staged a brief fightback with the ball falling to Alan Quinn on the edge of the area and the former Sheffield United man hitting a powerful shot which De Vries did well to save. Jon Stead picked up the loose ball and cut in from the left but hit the keeper with his effort.
With five minutes remaining, Jordi Gomez removed any lingering doubts regarding the result with a brilliant 35-yard freekick which gave Wright no chance and was every bit as good as Chelsea's recent two efforts in the FA Cup tie.
Late on, Counago shot weakly to De Vries and Scotland fluffed his chance of a hat-trick when he struck a tame effort which Wright oushed away, perhaps expecting a strike of more power.
A poor performance from the Blues who rarely looked like getting anything from the match from the moment Jason Scotland netted the opening goal in the third minute.
The home side played the better, more incisive football in a first half in which the Blues continually surrendered possession and all too often Kevin Lisbie was left isolated on his own up front, while the quality of the balls into the box was again below par.
After the break, Town started brightly, but the performance drifted and again the quality in and around the box was lacking. The two Swansea second half goals killed the game and secured the home side what was a deserved three points.
The result is a significant blow to Town's play-off aspirations and only back-to-back home victories against Blackpool and Nottingham Forest now look absolute musts if the Blues are to have anything to play for in the final months of the season.
Town: R Wright, Bruce, D Wright, McAuley, Balkestein, Garvan (Haynes 66), Quinn, Miller, Norris (Stead 74), Walters (Counago 46), Lisbie. Unused: Supple, Thatcher. Att: 14,020. Town att: 630.