Salomon Kalou's late winner sank Newcastle and increased the pressure on under-fire Magpies boss Sam Allardyce.
Essien celebrates after putting Chelsea ahead
A depleted Chelsea side took the lead when Shaun Wright-Phillips' shot fell for Michael Essien to slide home.
Magpies keeper Shay Given made a string of fine saves before his side levelled when Wayne Bridge turned Charles N'Zogbia's cross into his own net.
But Kalou had the last word when, despite looking offside, he met a loose ball in the area and fired home.
It has been a miserable festive period for Newcastle, who have picked up just one point in their three games so far.
But this performance will at least give their supporters some heart even if the result will provide scant consolation for Allardyce.
Three Premier League managers have been sacked this season immediately after losing to Chelsea and this latest setback will certainly not help his cause.
Things had looked promising for Newcastle in the early stages, with the visitors enjoying plenty of possession and carving out a couple of decent chances for Obafemi Martins.
And Chelsea, forced into seven changes by injury and suspension, were looking more vulnerable on home turf than they have done for most of their 72-game league unbeaten run here.
But Avram Grant's side gradually found their way into the game and a flurry of chances for the home side followed.
Kalou forced Given into his first save of the match at his near post and the Republic of Ireland international superbly clawed away John Mikel Obi's deflected effort before brilliantly keeping out Alex's close-range header.
Newcastle were hanging on by now but, although their determination could not be doubted, the defensive problems that have haunted them since Allardyce took charge were again their undoing.
A long throw was only cleared as far as the unmarked Wright-Phillips on the edge of the box and although his shot hit Kalou, it meant Given was stranded and Essien beat Steven Taylor to the loose ball before firing home.
Nicky Butt looks on as Bridge puts through his own net
Chances continued to come thick and fast for Chelsea and if Wright-Phillips had found Kalou with his pull-back or directed his header from Joe Cole's cross then the game would have been up for Newcastle by half-time.
Things did not improve for the visitors straight after the break either, with Butt forcing Given into another fingertip save while trying to clear a Wright-Phillips cross.
But Allardyce's men did not give up, with last-ditch blocks by Taylor and Faye typifying their spirit.
And they got their reward in bizarre fashion when N'Zogbia made headway down the left and, although neither Martins or Butt could force his low cross over the line, Bridge, in attempting to clear could only put through his own net.
That set up a thrilling final half hour and Given was again Newcastle's hero, keeping out Kalou's header and diving low to stop Michael Ballack's 25-yard shot.
The Magpies were still threatening too however and only a last-gasp Juliano Belletti clearance stopped Damien Duff from scoring against his old side.
Michael Owen's appearance from the bench after almost two months out with a thigh injury was another lift for Newcastle.
And it seemed they had picked up a hard-earned point until Kalou struck with under three minutes to go.
Obi's shot rebounded off substitute Claudio Pizarro and the ball bounced into the path of Kalou, who appeared well offside but rounded Given to slot home a dramatic winner.
Chelsea manager Avram Grant on Salomon Kalou's controversial goal:
"I didn't see it but we created so many chances that we deserved to win anyway.
"You saw the spirit of the team, they showed great spirit.
"We played some good football, especially in the first half, to create a lot of chances, then showed a lot of character at the end of the game."
Newcastle manager Sam Allardyce on Kalou's winner:
"It hurts deeply - not just for me but the players in particular.
"A result has been taken away from us by no fault of our own, by an assistant referee that has got a horrible decision wrong.
"You have to complain when a decision like this is made and it has cost us a crucial result."
Chelsea: Hilario, Belletti, Alex, Ben-Haim, Bridge, Essien, Obi, Ballack (Sinclair 76), Wright-Phillips (Sidwell 90), Joe Cole (Pizarro 65), Kalou.
Subs Not Used: Taylor, Ferreira.
Goals: Essien 29, Kalou 87.
Newcastle: Given, Beye, Taylor, Cacapa, N'Zogbia, Milner, Butt, Faye, Smith (Rozehnal 70), Duff (Viduka 89), Martins (Owen 74).
Subs Not Used: Harper, Emre.
Booked: Faye, Given.
Goals: Butt 56.
Ref: Mike Riley (Yorkshire).
BBC Sport Player Rater man of the match: Chelsea's Michael Essien 7.48 (on 90 minutes).
Please note that you can still give the players marks out of 10 on BBC Sport's Player Rater after the match has finished.