Doncaster Rovers and Huddersfield stunned their high-flying opponents, while Paul Ince returned to the sidelines to see Blackpool comfortably beat Sheffield Wednesday
Nigel Pearson's City opened up a three-point lead at the summit by registering their 12th win in 17 games, courtesy of a Jamie Vardy double and Lloyd Dyer's sixth goal of the season.
Meanwhile, Burnley's first league defeat in 13 matches came at the John Smith's Stadium as Huddersfield Town completed a 2-1 victory over Sean Dyche's side.
Oliver Norwood and James Vaughan scored within 10 minutes of the second half starting, the latter from the penalty spot, to give Huddersfield a comfortable cushion.
Danny Ings pulled one back for Burnley with six minutes remaining after a neat one-two with Sam Vokes, but the hosts held on.
Michael Duff's late red card added to the misery for Burnley, who have lost top spot for the first time since the start of October.
QPR looked on course for another victory thanks to Charlie Austin's first-half goal at Doncaster Rovers, but Theo Robinson and Paul Quinn netted in a shock comeback.
Blackpool celebrated the return of manager Paul Ince to the dugout following his recent ban with a 2-0 victory over Sheffield Wednesday.
Ricardo Fuller scored in the sixth minute and Dan Gosling struck late on to send Dave Jones' side to a third consecutive defeat.
Gary Johnson's Yeovil Town recorded only their third victory of the season, ending a run of three straight losses with a 3-0 triumph at Watford.
Byron Webster, Ishmael Miller and Joe Edwards were on target and Yeovil's win dropped Barnsley to the foot of the table as a 3-0 loss at home to Birmingham City cost manager David Flitcroft his job.
All the goals at Oakwell came in the first half, Paul Caddis recording his first and second for Birmingham before Nikola Zigic added a third in the 37th minute, with Barnsley announcing Flitcroft's dismissal after the match.
Blackburn Rovers picked up a fifth home win of the season when beating in-form Leeds United 1-0 at Ewood Park.
Tommy Spurr's goal on the stroke of half-time was enough to earn all three points and end Leeds' run of three consecutive wins.
Aitor Karanka collected his first victory as Middlesbrough boss with a 1-0 win over Bolton Wanderers, while Ipswich Town triumphed over Charlton Athletic by the same score to move up to 11th.
The day's early game saw two south-coast clubs go head-to-head, but Bournemouth and Brighton and Hove Albion could not be separated in a 1-1 draw.