Carabao Cup holders Manchester City needed penalties to progress past Brighton and into the quarter-finals after battling from behind to draw the game 2-2 at the Etihad.
Enzo Maresca's side never led on the night but scored four of their five penalties to win the deciding shoot-out 4-3, with Rayan Cherki striking the winner and Geronimo Rulli denying both Yasin Ayari and Lewis Dunk.
Brighton, the better side for the majority, will consider themselves unlucky to be dumped out of a competition Fabian Hurzeler had earlier professed to want to win. But City stuck to task and eventually prevailed on penalties - Hurzeler gets his chance to enact revenge when the two sides meet again in the Premier League on Saturday.
The visitors hit the front twice in the game, the opener struck by an impressive Malick Yalcouye, rounding off a slick Brighton move. There was some surprise in the stadium that the linesman's flag stayed down given Yalcouye's position on the last line, but the midfielder was given the benefit of the doubt with VAR not in operation.
Manchester City, aggrieved by the perceived injustice, tried to up the tempo and eventually got their reward when Mateo Kovacic guided his strike inside the post to equalise. But City's build-up was slow and predictable, without many of their regular starters after Maresca granted five key players a rest.
Just 90 seconds into the second period, City were undone again, Georginio Rutter's first-time finish from Jaouen Hadjam's pull-back giving Brighton the advantage - a lead their brave performance deserved.
As the game became stretched late on, City seemed to get more ragged. But such is the talent in their ranks, it was not long before another leveller unearthed itself.
Rayan Cherki's free-kick took a wicked deflection off Vitor Reis to wrong-foot Jason Steele and set up a grandstand finish, where both sides had chances to win it, but ended up leaving it to the lottery of penalties.
City narrowly avoided the fate that befell fellow Premier League heavyweights Arsenal on Tuesday, eliminated by fourth-tier Fleetwood Town, and have a meeting with League One outfit Bradford City in December as their prize.
24: PENALTY CLAIM! Rico Lewis is upended by Yalcouye in the box but referee Andy Madley waves away any suggestion of a foul.
29: CLOSE! Pascal Gross fizzes a low shot just past the far post.
30: GOAL! Yalcouye's instinctive finish beats Rulli but the goal carries more than a suspicion of offside.
40: GOAL! A precision strike from Kovacic from the edge of the area brings City level.
47: GOAL! City are caught sleeping after the restart as Rutter sends Hadjam's lay-off soaring past Rulli.
73: GOAL! Cherki's free-kick takes a cruel deflection off the boot of Reis and gives Steele no chance of saving.
90: PENALTIES! Kovacic is the first to miss, before Ayari and Dunk are also denied and Rulli gets to finish the evening as his side's spot-kick hero.
Man City boss Enzo Maresca:
"Brighton are in a brilliant moment. They score many goals every game so we knew it was going to be tough. We could have done better defensively. But we only started three months ago with this project.
"We have many things we can do better. The game was chaotic but overall we controlled it quite good.
"Brighton always go front foot, man to man. It will be exactly the same on Saturday.
"This is a different competition, but the ambition has to be the same. We need to do our business, that is winning games. At the moment we're doing that."
On the rotation: "I was happy with the way we planned the game, the rotation. I was very happy with the ones that played."
Brighton boss Fabian Hurzeler:
"We had enough chances to win this game. The goals we conceded are very unlucky, that's football, they had the luck on their side.
"We will analyse this game and we have a great chance on Saturday to take revenge - that's what we will try to do."
On staying in Manchester before facing City again: "We'll see if it's an advantage. We will try to make the best out of it, no excuses. We will come back full of energy and we go on Saturday."
