The Gunners self-destructed in a terrible second-half display to leave manager Arsene Wenger once more in the firing line.
This match was preceded by a march of Blackburn fans demanding the head of Steve Kean - but by the final whistle there was only one club left looking in crisis.
Own goals by Alex Song and Laurent Koscielny, plus two poachers goals by Rovers debutant Yakubu, dealt crushing blows to the Gunners, who had been apparently cruising at half-time thanks to goals from Gervinho and Mikel Arteta.
Maroune Chamakh's header made it 4-3 and a nervy last five minutes for Kean, but the league table now shows Blackburn above Wenger's men.
This must have had a look of painful familiarity to Arsenal fans - some great attacking play but hopeless fragility at set-pieces and a vulnerability to the pace of Junior Hoilett and Martin Olsson.
Arsenal had given Kean just the start he must have feared when Gervinho scored his first goal for the Gunners in the 10th minute.
Song's masterly run in midfield was followed by a peach of a through-pass that Gervinho ran on to and hit first-time, the ball going through Chris Samba's legs and across Paul Robinson into the far corner.
Samba exposed Arsenal with a free header at a free-kick - but high and wide - before Andrey Arshavin then brought a sprawling save out of Robinson with a sharp low shot from 20 yards.
Gervinho then wasted two more chances to extend the lead, and Rovers made the Gunners regret such largesse when Yakubu brought the scores level with the neatest of finishes in the 25th minute.
Arsenal had half-cleared the ball but Hoilett produced a pass to match Song's, and Yakubu instinctively nudged it past the on-rushing Wojciech Szczesny to score.
Samba's presence at set-plays continued to upset Arsenal, who had been heavily linked with a move for the giant Congo defender in the summer, and he won a corner but again headed over.
Ten minutes before the break a patient Arsenal build-up led to an incisive move that saw the Gunners regain the lead. Aaron Ramsey surged into the box on to Song's pass and, with Blackburn's defence expecting a ball to Robin van Persie at the near-post, cut the ball back for Arteta to rifle the ball into the roof of the net.
It was the Spaniard's first goal for Arsenal - but his second against Blackburn this season, having scored a last-minute winner for Everton from the spot.
Gervinho was wasteful again after good work by Arshavin, taking the shot when a pass to van Persie would have given his skipper an open goal, and Scott Dann blocked well.
Blackburn began the second half with obvious urgency and Arsenal looked rattled when Arshavin conceded a free-kick on the left of the area five minutes after the break.
Such fear was justified when Ruben Rochina floated in the free-kick and the ball bounced off Song's knee and into the net for an own goal.
Song, comfortably the man of the match up until that point, could only look in disbelief.
Fired up by the equaliser, Rovers went on a series of offensives ending with Yakubu stunning Arsenal and putting the home side ahead for the first time.
Hoilett's corner ended up at Steven Nzonzi's feet at the far post and he drove the ball at goal with Yakubu - with a suspicion of offside - stabbing it in from close range.
Van Persie glanced a corner wide of the post as Arsenal tried to respond, but it was Blackburn via another own goal who struck.
Olsson's pace destroyed Johan Djourou and he then nipped past Song and crossed - with Koscielny deflecting the ball into the empty net.
Robinson tipped over van Persie's header with 15 minutes left before Wenger threw caution to the wind, sending on Chamakh for Song.
The Rovers keeper again saved with his finger-tips from van Persie, but with five minutes left on the clock the Gunners skipper produced a stunning cross and Chamakh out-jumped both centre-backs to plant a header in the top corner.
There was a nervous end for Kean when Per Mertesacker had a clear header a few yards out in injury time but he sent the ball on to the roof of the net.