Everton loanee Lundstram fired home from close range in the 21st minute of Tuesday night's clash at Huish Park to earn Yeovil just their second home win of the season but it came either side of bad misses by Tom Ince and Stephen Dobbie.
The Glovers' impressive victory could have been more comfortable had Ed Upson's thunderous 30-yard volley not been kept out by the Blackpool crossbar.
And their high-flying visitors' frustration boiled over in the dying minutes with three red cards in quick succession. Kirk Broadfoot, Ricardo Fuller and Gary MacKenzie all saw red as Blackpool suffered a league defeat for just the third time this season.
Boosted by their shock 3-0 win at Watford, Gary Johnson handed four Yeovil players their Huish Park debuts and it was loanee Ishmael Miller, who had not made a start for Nottingham Forest this season, who caught the eye early on.
With just 40 seconds on the clock, the powerful forward spun and fired an effort straight at Matt Gilks and five minutes later, he was inches away from meeting Joel Grant's teasing cross.
At the other end, the visitors carved out their first chance of the match in the 10th minute but Chris Basham's deep cross was headed over by Dan Gosling.
Seven minutes later, Ince missed a chance to break the deadlock as he dragged his effort well wide after Gosling's through ball sent him racing clear.
And Yeovil would make the England Under-21 international pay when Lundstram opened the scoring. Davis' free-kick was chested down inside the penalty area by centre-back Byron Webster and the Everton loanee squeezed his effort in at the near post.
Sprung into action by the Glovers' opener, Paul Ince's men upped the ante and carved out two fantastic chances inside five minutes.
First Neal Bishop called another Yeovil debutant Chris Dunn into action for the first time with a volley after Jack Robinson's long throw. Three minutes later the unmarked Dobbie put his first-time effort into the back of the stand after Ince's blocked shot fell into his path.
Miller was showing little sign of rustiness in an all-action attacking display and the former West Brom man was only denied his fifth career goal against this opposition by the reflexes of Blackpool's Scotland international goalkeeper.
On the cusp of half-time, Lundstram fired wide at the far post after Miller's knockdown as the struggling home side finished the half on a high.
Gosling had two chances in the opening 15 minutes of the second half but the former Newcastle man failed to get enough power behind his efforts to seriously test Dunn.
At the other end, Upson was a lick of paint away from one of the goals of the season with a thumping 30-yard volley which cracked off the crossbar in the 67th minute.
Steven Davies was sent on as Blackpool looked to rescue a point to take on the long trip home and the former Bristol City forward nodded wide when well placed with 15 minutes remaining and the charging Yeovil wall blocked his free-kick a minute later after Luke Ayling had clipped Ince.
Miller continued to hunt for the goal his performance deserved and with 81 minutes on the clock he bent an effort just wide of the far post from Upson's pass.
Blackpool's hopes of a comeback were then extinguished by three red cards in the dying minutes.
First Broadfoot picked up a second yellow card for a foul on substitute Sam Hoskins in the 89th minute before Fuller saw red for violent conduct a minute later after he seemed to headbutt Luke Ayling.
Deep into added time, they were down to eight when captain MacKenzie joined his two team-mates in the dressing room after his second yellow arrived for a push on Miller.