The Netherlands produced a stunning second-half comeback to reach the semi-finals as Brazil's World Cup imploded in a dramatic game in Port Elizabeth.
After taking an early lead through Robinho's cool finish, the pre-tournament favourites were pegged back following an awful defensive mix-up early in the second-half and were found wanting in defence again soon afterwards when Wesley Sneijder headed in.
Brazil found themselves in even deeper trouble when Felipe Melo saw red for stamping on Arjen Robben with 17 minutes to go and, although Dunga's side gave everything in a thrilling finale, they crashed out in the quarter-finals for the second successive tournament.
It is the Netherlands who will go forward to play Uruguay or Ghana in the semi-finals and they have blown this World Cup wide open after putting paid to the idea that South American sides were set to dominate in South Africa.
Of the four teams from that continent in the last eight, Brazil were seen as the most likely to progress - and, for the first 45 minutes at least, it appeared they would not have too many problems in doing so.
The Netherlands have won renown for their defensive discipline in the last few weeks but that was nowhere to be seen when Robinho opened the scoring after 10 minutes.
The Dutch back-line had been forced to re-organise before kick-off when Joris Mathijsen was injured in the warm-up, with Andre Ooijer coming in, and he and fellow centre-back John Heitinga left a huge hole for Robinho to run on to Felipe Melo's pass and slot home.
Bert van Marwijk's side, who came into the game on the back of a 23-game unbeaten run, attempted to respond and Dirk Kuyt brought a low save out of Julio Cesar at his near post.
But other than that chance - and a blasted Sneijder free-kick that Julio Cesar also dealt with comfortably - the Netherlands were unable to open up Brazil, who were superbly marshalled at the back by Juan.
Dunga's side were not exactly in full-flow going forward themselves but they would still have been out of sight at half-time had it not been for Dutch goalkeeper Maarten Stekelenburg.
Stekelenburg brilliantly tipped over Kaka's curling shot after a neat move down the left involving Robinho and Luis Fabiano and also got a hand to Maicon's fierce shot after Dani Alves sent him forward on the overlap down the opposite flank.
It seemed Brazil were still in full control but that all changed after the interval when they gifted the Dutch an equaliser that completely changed the course of the game.
Sneijder whipped in a cross from the right after a quick free-kick and Julio Cesar, in trying to punch clear, only succeeded in colliding with Felipe Melo and the ball flicked off his team-mate's head and flew into the net.
Brazil took time to regain their composure but they remained a threat and Kaka came within inches of restoring their lead when he clipped the ball wide after latching on to Ooijer's clumsy clearance.
The Dutch, however, sensed a weakness at the heart of the South Americans' defence and they took full advantage after 68 minutes when another cross caused chaos in the Brazil back-line.
Kuyt flicked on Robben's corner at the near post and Sneijder headed in, sending the army of Oranje fans at Nelson Mandela Bay Stadium wild with elation
From being well on top, Dunga's side were now chasing the game and their hopes of rescuing their World Cup were dealt a huge blow when Felipe Melo inexplicably stamped on Robben after conceding a free-kick five minutes later.
Despite being a man down, the five-time champions had no choice but to throw men forward, and left huge gaps at the back in the final few minutes.
The closest Brazil came to saving themselves were a succession of Maicon corners, from one of which Lucio had a goalbound shot deflected wide.
But the Netherlands had several chances to add a third goal in final few minutes too, with Sneijder having a shot saved and Klass Jan Huntelaar hesitating when he had the simple task of teeing up Dirk Kuyt from six yards out.
Attempts on target
Attempts off target
Projected table based on current scores
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|Group C teams||P||W||D||L||F||A||GD||PTS|
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|Group E teams||P||W||D||L||F||A||GD||PTS|
|Group F teams||P||W||D||L||F||A||GD||PTS|
|Group G teams||P||W||D||L||F||A||GD||PTS|