King has bagged 13 goals for City this season, but he found the net at the wrong end in the first half to hand Wanderers their first home win in seven attempts stretching back to late September.
The striker sliced past Jack Butland when attempting to clear Bakary Sako's drilled free-kick at the front post, with Nathan Redmond also guilty of turning his back on the ball as part of a one-man wall.
Wolves put in a much-improved performance after the break and enjoyed several chances to extend their advantage, but profligate finishing and some superb saves from Butland ensured the result hung in the balance until the final whistle.
Birmingham started the better, Paul Caddis seeing his curling effort from 20 yards well parried away by Carl Ikeme.
Bjorn Sigurdarson found the side-netting for the hosts after good work down the left by Sako before Ikeme had to be alert once again to tip over after Roger Johnson and Jonathan Spector tussled to get on the end of Redmond's set-piece.
Blues were certainly posing the greater attacking threat and looking the more lively, but Wolves were steadily coming into the game more as the first half wore on.
Sylvan Ebanks-Blake saw his appeals for a penalty waved away before Kevin Doyle put the ball into the net only to be denied by the assistant's flag.
But Wolves did get the breakthrough just minutes later.
Ebanks-Blake went down easily under a soft challenge from Steven Caldwell right on the byline outside the penalty area. Sako whipped in the resulting free-kick and King could only divert the ball into his own net at the near post when trying to clear.
It was a goal Wolves arguably did not deserve on the overall balance of play in the first half, but that will not have mattered much to under-pressure manager Stale Solbakken.
Sigurdarson found himself clean through almost immediately after the restart only to fire straight at Butland, although the assistant's flag was raised.
Doyle's driving run ended with a shot narrowly wayward of Butland's left-hand post before Sako finished another mazy venture forward with an effort off target as Wanderers dominated.
Stephen Ward brought a solid save out of Butland at his near post, with Curtis Davies deflecting Doyle's shot on to the top of the crossbar from the resulting corner.
Butland then produced a superb instinctive save to keep out Sigurdarson's header from Sako's corner, keeping Blues in the game.
But they could not force a late leveller and Wolves were left celebrating only their third derby success over their local rivals in 15 attempts.
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