The loss also meant that Barca stay second and handed over the advantage in the Spanish title race to the surprise league leaders Sevilla.

Barca have 35 points from their 18 games, two behind Sevilla, but they have now played the same number of games.

Barcelona's Ronaldinho hit the crossbar with a free kick 11 minutes into the game but Espanyol deservedly opened the scoring after 30 minutes when Raul Tamudo outran the defence down the left flank before Luis Garcia sidefooted the ball home from a narrow angle on the edge of the six yard box.

Barca's second half substitute Javier Saviola equalised just before the hour, shaking off two Espanyol defenders before hammering the ball home from the edge of the area.

Tamudo, who had been doubtful until the very last minute after suffering from 'flu, then exploited gaps in the Barcelona defence after 65 minutes to score with a spectacular diving header.

The sloppy defending from the visitors produced a rare display of emotion from Barca coach Frank Rijkaard who punched out the plastic window of the dugout in frustration.

Francisco Rufete wrapped up the memorable night for Barca's modest neighbours by sliding in and scoring from a Luis Garcia pass.

Valencia notched up their fifth successive league victory with a comfortable 3-0 derby win over struggling Levante earlier on Saturday.

Second-half goals from Hugo Viana, Fernando Morientes and Roberto Ayala put Valencia firmly back in the title race.

"We are now where we should be, because of our history, our squad and our aims at the start of the season. We're now floating back to the top again," said Valencia coach Quique Flores.

The 2002 and 2004 Spanish champions move up from fifth to third, although they will slip back one place should Real Madrid beat Real Zaragoza on Sunday.

Valencia took the lead when Portuguese international Viana got his first league goal after 52 minutes.

Viana found the net with a exquisite lob from 25 metres to help put behind him his unhappy last season at English Premiership side Newcastle United.

Four minutes later, Morientes slotted home a Miguel cross from out on the left wing and clinched three points when Ayala headed home a David Villa free kick 10 minutes before the whistle.

To add to their woes in their battle to avoid relegation, Levante look to have lost their highly-rated central defender Alvaro for at least a month after the Brazilian broke a collar bone in an accidental clash with his own goalkeeper Jose Francisco Molina.

Real Madrid start life without superstar David Beckham by playing host to Real Zaragoza on Sunday.

Beckham announced on Thursday that he was moving to Los Angeles Galaxy and Real coach Fabio Capello responded on Saturday by saying that the former England captain would never play again for the club.

Real have an injury crisis, as well as defenders Michel Salgado and Sergio Ramos suspended, which means there will be some strange faces in strange positions in their back four against Zaragoza.

However, Capello tried to sound upbeat on Saturday after dropping the Beckham bombshell.

"We are not that far from first place. Sure, we'll be missing some people (against Zaragoza) but they'll be back soon," said the Italian coach.

The Spanish giants have lost three of their last four league games but are still started the weekend in third place, although they are now five points behind leaders Sevilla.

League leaders Sevilla, secure that they will end the weekend in pole position, will be looking to extend their 100 percent record at home in their Sanchez Pizjuan stadium this season against Real Mallorca on Sunday.