Brian McBride and Erik Nevland struck to haul Fulham out of the Barclays Premier League bottom three and leave Birmingham on the brink of relegation in a result that ended 2-0 for the Londoners.
McBride converted Jimmy Bullard's 52nd-minute free-kick to edge the Cottagers out of the drop zone for the first time since Boxing Day before Nevland sealed a famous victory with a fine finish.
It was the first time the London club had registered successive league victories since September 2006 and the win sets them up beautifully for a nerve-shredding finale at Portsmouth.
Even manager Roy Hodgson appeared to accept his side's seven-year stay in the top flight was over after the 3-1 defeat by Sunderland a month ago, but its remarkable escape act continues.
Winning three of its last four matches has left Fulham on the threshold of a stunning achievement - at one point it was 1/50 for the drop - that could yet be ruined at Fratton Park.
In contrast, Birmingham is heading in the opposite direction.
With the stakes so high, the match was short on quality but high in drama, particularly in a nail-biting second half.
To its credit, Fulham tried to play football while a workmanlike Birmingham relied on James McFadden for its only moments of inspiration.
The opening of the match was greeted by a crescendo of noise as Fulham fans, armed with 'clappers', sought to lift their team.
And they were almost given the dream start when McBride headed a cross by Paul Konchesky onto the crossbar, although the linesman had wrongly flagged offside.
Lightning reflexes from Maik Taylor denied Fulham in the eighth minute as Simon Davies pulled the trigger on Bullard's free-kick only for the Blues goalkeeper to intervene superbly.
Errors began to creep into Fulham's play just as it sought to crank up the pressure on a side that has failed to keep a clean sheet in their last 17 matches.
Brave defending from centre-back Brede Hangeland snuffed out two promising attacks by Birmingham, whose influence on the match was growing.
A corner from the left resulted in some aerial ping-pong with Hangeland, Aaron Hughes and Clint Dempsey scrambling desperately to clear.
McFadden sliced Fulham open with a jinking run that Sebastian Larsson concluded with a dangerous cross that Mikael Forssell could not control.
The Cottagers' goal was coming under mounting pressure but their defence, led by the magnificent Hangeland, was keeping them at bay.
Play became increasingly cagey but one slick interchange by Fulham, involving Bullard and Dempsey, interrupted the midfield battle that was unfolding.
Fulham started the second half with a flourish and crept ahead in the 52nd minute.
Jaidi conceded a free-kick for an elbow on McBride that Bullard lofted into the box, and the American striker escaped some sloppy marking to nod home virtually on his knees.
Birmingham was at panic stations once again a heartbeat later when Diomansy Kamara jinked his way into the box but he chose to shoot from an acute angle when he should have squared across goal.
McFadden flashed narrowly wide and in the 68th minute Kamara - who had ousted David Healy from the starting line-up - was replaced by Nevland.
Birmingham won a dangerous free-kick but failed to utilise its controversial tactic of using Jaidi to block the goalkeeper's vision and Fulham cleared the danger.
Dempsey missed a good chance to extend the lead when he sent