Town's automatic promotion hopes were dealt a big blow by a 2-0 defeat at Wolves. The Blues were well off the pace in a first half during which Colin Cameron and Carl Cort put the home side two goals in front. Town improved after the break but created few chances.
Boss Joe Royle switched back to a 3-5-2 formation with Matt Richards coming in as left wing-back and Darren Currie dropping to the bench.
Wolves were out of the blocks quickly and South Korean international Ki-Hyeon Seol curled a 25-yarder wide.
After five minutes the home side went in front. Lee Naylor went round Fabian Wilnis on the left - possibly fouling him as he did so - and crossed low into the box. Kenny Miller missed the ball, it struck David Unsworth and landed at the feet of Colin Cameron who took it wide of Kelvin Davis and shot into the net off the cross-bar.
Wolves were close to a second in the 10th minute when Seol crossed from the right for Kenny Miller. Kelvin Davis did well to anticipate the ball into the box and blocked Miller's strike, Jason De Vos clearing.
Two minutes later, the Blues had their first serious chance of the game, Jim Magilton's deflected shot after a short corner with Tommy Miller proving tricky for keeper Michael Oakes who couldn't hold on, a defender putting the ball out.
Seol forced Kelvin Davis into another fine save on 17 when he cut in from his right-wing position and shot at the Town keeper's near-post. Davis got down well to push the ball out for a corner with his left hand.
Wolves continued their onslaught, Seyi George Olofinjana shooting on the turn from the edge of the area, Davis again saving.
On 22 the home side went two in front. Cameron broke quickly and unchecked from midfield before laying the ball across the six-yard box for Carl Cort to tap in.
Town, who switched to 4-4-2 soon after the second goal, almost pulled a goal back within a minute. A corner found its way to Ian Westlake on the edge of the area off referee Steve Dunn, the midfielder's left-foot shot cannoning back off the cross-bar.
The same player shot wide from 25 yards soon after, before David Unsworth headed a Jim Magilton corner over.
Magilton went very close to an equaliser with a 20-yard freekick in the 39th minute, Olofinjana having fouled Westlake.
Wolves might have scored a third when Lee Naylor sent the ball across the box but out of the reach of Jody Craddock.
As half-time approached, the otherwise anonymous Shefki Kuqi seized on a poor defensive pass and struck a first time shot off Michael Oakes's left-hand post.
Wolves thoroughly deserved their lead at the break, although the Blues could have been rather on terms having hit the woodwork twice. The home side had controlled the midfield throughout and all too often their runners weren't tracked by their Town counterparts, while wide on the right, Seol gave both Unsworth and Richards a hard time.
There was little surprise that Joe Royle made changes at the break, Scowcroft coming on for the unusually quiet Kuqi and Darren Currie taking over in midfield from the off-the-pace Matt Richards.
The introductions made a big difference and in the 53rd minute Currie almost set-up a Town goal for Darren Bent. The midfielder made an inch-perfect ball into Bent's path, the England U21 lobbing Oakes but also the cross-bar when he really should have scored.
Town enjoyed the lion's share of possession but the final ball was often wasted. Just before the hour, Scowcroft picked up a yellow card for a clumsy challenge on Olofinjana.
Chances were rare at either end but on 66 David Unsworth hit a weak 30-yard freekick which gave Oakes little trouble.
Westlake shot wide in the 74th minute, before last season's Player of the Year was sacrificed for another striker, in the shape of Pablo Couñago.
Scowcroft headed Magilton's excellent right-wing cross to Oakes, before Leon Clarke had the ball in the Town net once again but only after rather obviously fouling Richard Naylor.
Kelvin Davis pulled off another fine save from Paul Ince before Couñago's cross from the left went in between Scowcroft and Currie.
Davis made the save of the match with two minutes left on the clock, reacting superbly to push Seol's virtually point-blank effort over the bar. It was as good a save as you'll see anywhere.
Town rarely threatened in the latter stages, the reduction in the midfield numbers giving the impetus back to the home side, who had deserved their victory on the strength of their first half display.
The Blues were miles off the pace in the first period and probably ought to have matched Wolves' 4-4-2 formation much earlier than they did, while there was some very lax tracking back from the midfield who rarely enjoyed any possession during the first period.
It was a different story in the second when the Blues had the best of it but carved out few chances, Darren Bent wasting the best of them.
The defeat means a victory over Sunderland a must on Sunday, while Town must now hope that someone does them a favour by taking points off Wigan, with Leicester the first candidates on Saturday.
Town: Davis, Wilnis, Richards (Currie 46), De Vos, Naylor, Unsworth, Magilton, Miller, Westlake (Couñago 75), Bent, Kuqi (Scowcroft 46). Unused: Price, Horlock. Att: 25,882.