Serbian striker Branko Jelic struck twice for the home side as Cottbus - bottom of the league going into the tie - pulled off the Bundesliga's biggest upset. Jelic, a winter signing from Chinese outfit Xiamen Lanshi, took both goals while Bayern failed to assert their authority with top stars Bastian Schweinsteiger, Luca Toni and Franck Ribery in the side.
Cottbus picked up only their fourth win of the season as mighty Bayern suffered their second defeat in three days following their 2-1 UEFA Cup humbling by Anderlecht last Thursday.
Lacklustre leaders Bayern were left red-faced when Cottbus took a shock lead as Jelic drilled home his shot on 18 minutes before Bayern's French star Ribery had a 28th minute penalty saved at the Stadium of Friendship.
And the home side extended their lead just seven minutes before the half-time break when Jelic struck again to leave Bayern reeling and give them an almighty wake-up call after dominating the league so far this season.
"That was a black day for my team, it is possible that players had believed the championship was a walk in the park," said coach Ottmar Hitzfeld whose side's seven point lead has been trimmed back to five points.
"The victory was deserved by Cottbus. They played with a large heart, as you have to do if you are involved in a relegation battle. I am disappointed, particularly in the way we were beaten,” Hitzfeld said. "We were asleep for the first 20 minutes and didn't win our battles. Nearly everything went wrong."
Cottbus coach Bojan Prasnikar - who was true to his pre-match assertion Energie would attack their illustrious hosts - was delighted as his side moved out of the bottom three.
"We were under intense pressure," said Prasnikar. "But this win will give us a great deal of confidence. We made few errors and played with big hearts.”
The result leaves UEFA Cup quarter-finalists Bayern to dwell on only their second league defeat of the season while Cottbus lifted themselves out of the bottom three into 15th.