Phillips controversially scored his first goal for Leicester as the Foxes beat Bournemouth to make it nine league wins in a row.
Second-half sub Phillips headed past Lee Camp with 10 minutes remaining but the furious home side were certain the whole of the ball did not cross the line.
After referee Darren Drysdale had consulted with his assistant, the goal stood and ensures Nigel Pearson's men keep hold of the best away record in the division.
Despite Leicester's club record-breaking run - and being seven points clear at the top of the league heading into the match - it was the home side who started on top.
Andrew Surman rifled a shot over the bar after six minutes before Tokelo Rantie skinned Wes Morgan for pace and was inches away from setting up Harry Arter for the opener.
But the team in blue were not visibly troubled by the soft slippery pitch and started to stamp their authority on the game.
Top-scorer David Nugent sent strike partner Jamie Vardy down the right-hand side but Lloyd Dyer could not convert his deep cross past a diving Camp.
Two minutes later Vardy should have bagged his eleventh of the season after 19 minutes but was again foiled smartly by Camp.
The keeper diverted the striker's shot onto the bar after Danny Drinkwater had played him clean through with a defence-splitting pass.
With 30 minutes on the clock the duo reignited their duel when Anthony Knockaert found Vardy in space and the frustrated forward saw his shot hit Camp before being cleared off the line by Tommy Elphick.
Cherries captain Elphick found himself at the other end of the pitch moments later, heading an Ian Harte free-kick narrowly wide of Kasper Schmeichel's goal.
Eddie Howe started with news signings Yann Kermorgant and Adam Smith on the bench.
Kermorgant, who infamously missed a penalty for Leicester in the play-offs semi-finals against Cardiff in 2010, entered the fray at half-time along with Matt Ritchie.
The introductions lifted the home side with the match turning into an end to end contest.
Lewis Grabban, looking for his 13th league goal of the season, had Schmeichel scrambling after 58 minutes but his stinging 25-yard strike narrowly missed the post.
Ex-Derby stopper Camp, who was having an inspired afternoon, reacted brilliantly two minutes later to parry a bullet Knockaert header away from the net.
The table-toppers turned to veteran poacher Phillips after 72 minutes to try and finally beat Camp and nick the three points - and the former England striker did not disappoint.
A desperate Bournemouth pushed for the equaliser after the goal but failed force Schmeichel into a serious save.
The match officials were escorted off the pitch to a chorus of boos from the home crowd but Leicester's promotion bid is still firmly on track.