Rangers striker Kenny Miller returned to haunt Celtic with a double strike against his former club in an incident packed 4-2 away win for Rangers which saw two red cards.
Daniel Cousin put the home side ahead with a fine solo strike before Georgios Samaras pounced to make it 1-1 at the interval.
But former Parkhead player Miller, whose first goal as a Celtic striker had been against Rangers, scored either side of a wonderful Pedro Mendes strike to take the visitors into a commanding lead in the season's first Old Firm derby.
The drama was far from over as both sides ended up with 10 men after Cousin and Hoops' substitute Jan Vennegoor of Hesselink, on minutes earlier for Georgios, were sent off.
Celtic midfielder Shunsuke Nakamura fired in an injury time consolation for the home side but there was no doubt that the visitors - and Miller, who has spent all his time trying to win over the Light Blues fans - had the last laugh.
Rangers move up to first in the Premier League, dislodging Kilmarnock, which had enjoyed the view from the top after an impressive 2-0 win over Dundee United at Tannadice on Saturday.
Inverness substitute Dougie Imrie claimed an 85th-minute winner to send Falkirk to a 2-1 defeat and leave them without a point in the SPL.
Mendes and defender Madjid Bougherra made their Old Firm debuts, with Miller starting up front alongside Cousin as the visitors pressed in the opening minutes.
Cousin sparked the game into life in the 36th minute when, with no real sign of a breakthrough, he put the visitors ahead with a fine solo goal.
Mendes sent a looping ball up the right-hand side and the Rangers striker raced past Hoops left-back Mark Wilson with some ease, drove into the box and drilled an angled shot inside Artur Boruc and the post.
But two minutes later Celtic was level when Aiden McGeady's cross into the six-yard box was missed by David Weir and came off the hapless Sasa Papac straight to the feet of Samaras, who gleefully knocked it past Allan McGregor.
Up until then there had been little between the two sides.
It was the champions who went closest first when skipper Stephen McManus headed a Nakamura free-kick just wide of the far post in the seventh minute.
As the game became increasingly tetchy, Rangers midfielder Kevin Thomson picked up a booking a minute later for a reckless and needless foul on Nakamura before McManus was also shown a yellow for throwing the ball at a referee's assistant following an unfavourable decision.
Samaras had a near-post header easily saved by McGregor before McGeady came closer when he sent a shot from distance just past the post.
On the half-hour mark, as the Light Blues took a turn of attacking, Cousin lashed a Steven Davis corner well over the bar.
But two minutes later, Rangers veteran defender David Weir almost put Andreas Hinkel's cross into his own net, the ball flashing off the shoulder of McGregor before the Ibrox keeper collected.
The two goals took the sides into the interval level but the high tempo continued after the break with both sides quickly back into battle mode.
In the 51st minute, Rangers forged ahead for the second time through Miller.
After Cousin had been foiled at the edge of the box, the ball fell to Thomson who curled