Liverpool 1 (Bertrand og 45)
Reading 2 (Sigurdsson 90 pen, Long 100)
The Royals won at Anfield for the first time in their history after a night of extraordinary FA Cup drama which saw Shane Long's extra time header secure a 2-1 victory over the Reds.
Reading dominated proceedings but were forced to go into the break a goal down after Ryan Bertrand saw an unfortunate deflection cannon past Adam Federici and into the net.
Brian McDermott's side created a number of golden opportunities, including a solo run by Jobi McAnuff that was an inch away from becoming one of the greatest goals in the history of the competition.
However Gylfi Sigurdsson kept his nerve to steer home a last minute penalty after Shane Long was fouled in the box, before Longy himself nodded home in the game's 100th minute from a wonderful Brynjar Gunnarsson cross to secure a home tie with Burnley in the FA Cup fourth round.
Liverpool: Cavalieri, Degen (Skrtel FT), Insua, Agger, Carragher, Gerrard (c) (Babel HT), Lucas, Aquilani, Benayoun, Kuyt, Torres (Ngog 30)
Subs: Gulacsi, Aurelio, Spearing, Pacheco
Reading: Federici, Gunnarsson, Bertrand, Mills, Ingimarsson (c), Karacan (Long 81), Cisse (Howard 59), McAnuff, Sigurdsson, Rasiak (Kebe 65), Church
Subs: Hamer, Tabb, Pearce, Matejovsky
Yellow: Karacan, Mills, Ingimarsson, Gunnarsson
Ref: P DowdFirst Half
The Royals made no changes to the side that earned a respectable draw with the Reds at Anfield eleven days previously, though Rafa Benitez did make a number of alterations - as Alberto Aquilani, Daniel Agger, Yossi Benayoun and Phillip Degen came into the side.
Most notably regular stopper Pepe Reina was left out the squad, with relative unknown Diego Cavalieri earning his chance to shine in front of the Kop.
Steven Gerrard was immediately involved as the game got underway, whipping in a cross similar to the effort that earned his side a replay at Madejski, only to see a deflection take the ball just wide of the post.
At the other end Gylfi Sigurdsson almost began the game with a bang, rifling in a fizzling free-kick that was just tipped around the post by Cavalieri.
Almost immediately Simon Church continued the confident spurt from the visitors, controlling a chipped through ball from Jobi McAnuff before testing the Pool number one with a low drive.
In truth the first twenty minutes of the game were tentative at best from both sides, with Fernando Torres' meekly shooting wide to sum up the contest midway through the half.
However 22 minutes in a golden chance for the opener arrived, and it fell to the feet of a Reading player. Jem Karacan's incisive breakaway allowed Church to break down the right hand side, and despite being penned down in a corner the Welsh international magnificently turned Agger to dash into the box before sending a ball across goal.
Unfortunately Gzregorz Rasiak could only slice high and wide, with the Polish international given little time to react to Jamie Carragher's missed clearance.
The chances didn't stop there for the Royals, as moments later a superb run and cross from McAnuff was headed just wide by Church.
If that tested the nerves of the home support then they would have been tested again half an hour into the half, as star man Fernando Torres limped off - replaced by David Ngog. Naturally the Premier League side had plenty of talent in reserve, as proved as Benayoun curled a classy effort narrowly wide of the post with five minutes remaining in the half.
As the fourth official held up his board for a minute's added time the visitors could rightly feel to have been the better side, however as so often is the case they were unjustly dealt a blow as Pool took the lead seconds before the break.
A half cleared corner was dribbled back into the area by Steven Gerrard, and as the England international drilled a cross into the box Ryan Bertrand deflected it into his own net, past a helpless Adam Federici.
If Brian McDermott's men needed a 'pick me up' after the interval it came in the shape of another unexpected Liverpool substitution, as Ryan Babel replaced Gerrard.
Despite that switch the home side seemed to have more authority to their play, as Dirk Kuyt scooped a volley over the bar five minutes in.
Fifteen more minutes passed before any more goalmouth action, as Aquilani's blocked free-kick was followed up by Agger, who lashed in a trademark strike that shot narrowly wide of Federici's goal.
Reading responded immediately as sub Brian Howard made a quick impact, curling in a delightful set piece that narrowly evaded the diving Ingimarsson.
As the visitors pushed forward in pursuit of an equalizer Benitez's charges found more opportunities to break, as evidenced when Aquilani headed a good chance wide after foraging work from Benayoun.
It was going to need something special to drag the blue and white hoops back into proceedings, and it so almost game thanks to a moment of magic from Jobi McAnuff.
The dazzling winger picked up the ball inside his own half, before slaloming 50 yards past five Liverpool players and into the opposition area. That left him with just Cavalieri to beat, but with the goal at his mercy the former Watford man somehow clipped wide of goal.
Despite the miss his efforts drew applause from all around the ground, so close to one of the all time great FA Cup goals.
Simon Church headed just over with five minutes remaining after more superb work from Brynjar Gunnarsson on the right wing, and with time ebbing away it was becoming apparent that McDermott's men would have nothing to show for a great display.
It almost proved to be the case - as a late long range effort from Gylfi Sigurdsson tested the reflexes of Cavalieri once more, who tipped round the post.
However the drama wasn't over, far from it. Substitute Shane Long went down in the box in the dying moments of stoppage time and referee Phil Doud dramatically pointed to the spot.
It was a lifeline that the Royals so deserved, and Sigurdsson stepped up to show a calm head beyond his tentative years by slotting home in front of a delirious travelling support to send the tie into extra time.
A nerve racking extra period began as Ryan Babel ford a low stop out of Federici, and the tempo didn't look like dropping despite an already frantic evening of football.
Frantic it might have been, but there was plenty of class there too - and it was some quality from Reading that would give the away side a remarkable lead after ten minutes of extra time.
Brynjar Gunnarsson may be a self proclaimed 'makeshift' right back, but the Icelandic international looked like he'd been settled into the role for his whole career as he sublimely nutmegged Insua, before sending in a pinpoint cross for Shane Long to head home.
Reading were producing heroes right across the backline. Even as Benayoun broke the offside trap to stream completely through on goal Federici denied the Israeli international with a brave dive at his feet.
David Ngog scuffed another genuine chance wide of the post in the 111th minute, as unsurprisingly the Royals found themselves pinned in their own half for the majority of the second period.
Hearts were well and truly in mouths as Lucas Leiva headed wide with the goal gaping in the last thirty seconds, but the night was to belong to Reading as Mr Dowd blew his full time whistle to signal one of the most magical results in our history.