The Reds cruised to a three-goal win at Old Trafford, with their captain converting two spot-kicks, a result that moves them up to second - four points off league-leaders Chelsea
The Reds skipper converted his first penalty before the break after Rafael handled Luis Suarez's cross inside the box, before doubling his side's advantage after a Phil Jones foul minutes into the second half.
But Gerrard missed the opportunity to become the first ever Premier League player to score a hat-trick of penalty-kicks after Nemanja Vidic was sent off for bringing Daniel Sturridge down in the area.
The 33-year-old picked his spot for the third time of the afternoon but hit the post, although Suarez managed to add a third minutes later.
|VIEW FROM OLD TRAFFORD
|By Peter Staunton at Old Trafford
They are still singing in the Stretford End away to my left more in defiance than anything else. This was a Manchester United performance in nothing but name today. Totally clueless from start to finish, it may well go down as not the final nail in the coffin of the David Moyes reign - but perhaps the first.
Two weeks United had to prepare for this match and they had a full squad to pick from. But everything about them today was second rate. Only once was Simon Mignolet pressed into action while, at the back and in midfield, United were chasing shadows.
There were mistakes to put in just about every category. We already know wholesale changes are needed. This will only hasten that process.
For Liverpool, though, they came and performed very well. They passed the ball and nipped in to win it back. They were quicker in their tasks and lighter on their feet. It was 0-3 and could have been more. Whisper it, this could be their year.
An under-par performance coupled with a further dent to United's European aspirations piles further misery on David Moyes and the Premier League champions, as their Merseyside rivals remain firmly in the hunt for a first league title since the 1989-90 campaign.
Sturridge was quick to showcase his movement if not his finishing prowess early on when he fired wide after just two minutes before Liverpool appeals for a penalty were waved away.
Suarez appeared aggrieved after feeling the clumsy tackles of Jones and then Marouane Fellaini in quick succession warranted spot-kicks - but Clattenburg had other ideas.
Other than Liverpool's early pressing, chances were few and far between in the opening exchanges - Robin van Persie's blocked effort was the best United could produce before Sturridge spurned the opportunity to test David de Gea when he failed to fashion a clean strike on goal after turning Vidic.
Allen did force the Spaniard into a save shortly after, capitalising on Vidic's error to get an effort away on goal, before Rafael handled inside the area to give Liverpool a penalty after Suarez cut in from the left wing.
Gerrard kept his cool to send De Gea the wrong way and hand the visitors a 34th-minute lead - while Rafael will perhaps feel a touch fortunate not to have been given a second yellow card, having already been cautioned for a foul on the Liverpool skipper.
United finished the half on top, Wayne Rooney first seeing a shot saved by Simon Mignolet before the follow-up was well blocked by Martin Skrtel.
But the hosts made the worst possible start to the second half when Jones bundled into Allen, with Gerrard registering 10th Premier League goal of the season with another penalty.
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A convincing victory was complete.