The Black Cats suffered their first defeat of 2007 in the league to put a small dent in their hopes of returning to the top-flight at the first attempt.
Roy Keane's men had won 14 and drawn the other three of their last 17 league matches, but they could not extend that record in front of a capacity crowd at Colchester, who are pushing for a play-off spot themselves.
The Essex side broke the deadlock in the fourth and last minute of injury time at the end of the first period.
Wayne Brown has played in every minute of every match this season, but he has not scored until he met Kevin Watson's accurate free-kick with a thunderous finish which gave keeper Darren Ward no chance.
Sunderland were on the attack early in the second half and they always looked like grabbing the equaliser.
It duly arrived in the 55th minute thanks to Dwight Yorke's precision header from Daryl Murphy's cross.
That set up an exciting finale, but it was Colchester and not Sunderland who proved the more clinical going forward as they plundered two goals in the last eight minutes to seal a memorable win.
The first came from Richard Garcia, who crashed home his seventh goal of the season on 82 minutes following excellent work from substitute Hogan Ephraim.
It was a clinical finish from the Australian, who turned on a sixpence to drill home past Ward.
Sunderland looked a beaten side and their fate was sealed on 89 minutes when substitute Jamie Guy stormed through the middle and found Jamie Cureton inside the box.
Cureton was upended by Dean Whitehead for a clear penalty and it was the experienced striker himself who took on the responsibility of sweeping home the spot-kick to rattle up his 24th goal of the campaign.