The Rossoneri dominated possession for long periods but failed to find the breakthrough and ultimately succumbed to the Argentine striker's clinical second-half finish.
The Rossoneri dominated possession for the majority of the 90 minutes and struck the crossbar during the first half through Mark van Bommel but Diego Milito scored the only goal of the game early in the second period.
The Argentine fired home after Ingazio Abate had failed horribly to intercept Javier Zanetti’s cross-field pass.
Inter thought that it had opened the scoring just five minutes in when Thiago Motta found the back of the net with a header from Maicon’s free kick from the right-hand side but the Brazilian-born Italian international had been standing in an offside position.
Having survived that scare, Milan gradually began to take control of the game and Zlatan Ibrahimovic called Julio Cesar into action for the first time on 10 minutes with a veritable daisy-cutter from the edge of the area before Alexandre Pato fired high and wide after Kevin-Prince Boateng’s wildly inaccurate volley had been inadvertently deflected into his path by Urby Emanuelson.
With their clever moment, Ibrahimovic and Pato were asking plenty of questions of the Inter defense, while Boateng also looked menacing whenever he joined the attack.
However, the Nerazzurri coped quite well with everything their city rivals threw at the during the opening 45 minutes and, in truth, it was they who created the best opening of the half. Yuto Nagatomo whipped over a wonderful cross from the left which found its way to Ricardo Alvarez. But, despite managing to control the ball, the Argentine came under pressure from Antonio Nocerino and could only shoot tamely at Christian Abbiati.
Alvarez’s profligacy was almost immediately punished by van Bommel but his well-struck drive from the edge of the area just before the break came crashing back off the crossbar before Julio Cesar got down well to parry Emanuelson’s follow-up away to safety.
Milan continued to dominate possession in the second half but it was Inter which made the breakthrough nine minutes into the second half. Milito found the bottom corner with a terrific low strike after Abate had completely missed his kick as he tried to cut out Zanetti’s ball from wide on the right.
The goal undeniably rattled Milan and Inter twice went close to doubling its advantage with well-struck strikes from distance from Alvarez and Nagatomo. The Nerazzurri’s Japanese fullback threatened again on 72 minutes when he weaved his way into the box only to shoot straight at Abbiati.
Milan squandered a half-chance when Pato failed to convert after the ball had dropped invitingly for him six yards out, while substitute Clarence Seedorf drew a fine save from Julio Cesar with a long-range effort.
However, the Rossoneri could find no way through and thus missed the opportunity to pull clear at the top of the table. The reigning champions are also now just five points ahead of Inter, which remains fifth but are now very much in the hunt for this year's title.