Hal Robson-Kanu eventually scored in the 74th minute of Saturday's Championship clash at the Madejski Stadium when Reading were awarded an astonishing third spot kick, but by that time Stephen Foster and Matt Done had Barnsley two goals to the good.
One-time Manchester United youngster Steele had already completed a trio of fine stops to keep the hosts at bay before he kept out Ian Harte and Noel Hunt from 12 yard - both penalties coming via fouls from Barnsley full-back Jay McEveley.
The visitors started in encouraging fashion, peppering the Reading penalty area with a flurry of corners.
Having withstood the early barrage, Brian McDermott's side got into their passing, with Noel Hunt and Jimmy Kebe linking well on the right of the attack.
Despite this initial ebb and flow, the game was low on chances until Barnsley took the lead slightly against the run of play in the 27th minute.
This time a corner was successful for Hill's men as Foster escaped the attentions of the Royals defence to plant a diving header past Adam Federici from Jacob Butterfield's left-wing delivery
Reading looked for an immediate response and Barnsley were indebted to Steele for preserving their lead with a pair of fine saves.
With half an hour gone McEveley brought down Kebe in a dangerous position and Harte's free kick was headed goalwards by Alex Pearce, only for Steele to parry clear.
Home captain Jobi McAnuff then cut in menacingly from the left before unleashing a fierce drive that Steele tipped over the crossbar.
Reading turned up the pressure after the interval and Harte looked to take a more direct route to goal after Foster bundled Jem Karacan over.
Steele was once again equal to the task, pushing the Irishman's effort round the post, and Karacan and Hunt wasted good opportunities before Reading's profligacy reached astounding levels.
McEveley was penalised for a 56th-minute foul on Kebe inside the area and after some deliberation with countryman Hunt, Harte stepped up to take the kick.
But Steele frustrated him once more as he guessed correctly to his left.
A minute later McEveley made himself a repeat offender, infringing Robson-Kanu to give Hunt the chance to show Harte how it should be done from the spot.
In the event he went for the same corner and Steele magnificently produced the same result.
The host continued to be complicit in their own downfall shortly after the hour when a Harte corner looped over Steele and seemed destined for the net until Pearce applied an errant final touch to divert the ball back across the goal to safety.
Barnsley then added insult to injury in the 68th minute as Matt Done, a summer signing from Hill's former club Rochdale, sprung the Reading offside trap to slot his side into a two-goal lead.
Robson-Kanu then sent Steele the wrong way after Rob Edwards fouled Hunt, but Barnsley hung on.
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