Danny Haynes proved the derby winner again with his fourth goal against the Canaries to give Blues three vital and deserved points.
The striker converted the outstanding Pablo Counago's pass late in the first-half to give Town the advantage.
Norwich stung Town in the first five minutes through Ched Evans' long range strike before Blues levelled on 13 minutes, Counago releasing Haynes whose cross was put into his own net by Alex Pearce.
Jim Magilton made three changes from the team that drew with Cardiff, Counago returning to the side from a three match suspension, Alan Lee making way. Shefki Kuqi came into the side for his first start since rejoining the Club on loan while David Wright took over from Sito at left-back.
The Canaries included Darren Huckerby in their starting side, the wideman making his 200th appearance for the club.
The visitors stunned the majority of the full house crowd on five minutes when Evans struck for Glenn Roeder's side, beating Stephen Bywater with a low shot from 30 yards.
Town responded with Alan Quinn testing David Marshall in the Norwich goal with a shot from distance before Blues levelled, Counago, central to the move, releasing Haynes down the right and his cross was diverted into the net by on loan Reading defender Pearce.
Marshall saved well from Tommy Miller's free-kick as Blues began to dominate possession.
Counago was at the heart of Town's attacks, dropping off his marker to link the play and another deft touch from the Spaniard released Quinn but Marshall was alert to the danger.
Haynes fired over from 20 yards, then Jason De Vos headed wide from Owen Garvan's corner as Town pressed for a second.
Marshall saved superbly from Alex Bruce's header from another corner, Haynes's follow up shot deflected for a corner.
Matthew Pattison tested Bywater from distance with a rare Norwich shot before Blues were forced into a change, Kuqi struggling with a hamstring that had seen him sidelined for three weeks, Jon Walters his replacement. Walters back after cartilage surgery three weeks ahead of schedule.
The former Chester player was immediately in the action, bursting on to another Counago pass, Marshall heading clear but the ball eventually broke to Counago again who sent Haynes in and the England U19 international buried his shot in the Norwich net.
The best player of the first-half, Counago had the last touch of the opening 45 minutes, heading over after more good work by Haynes down the right.
Bruce and Quinn both picked up yellow cards in a frantic start to the second-half with Miller firing a yard wide and Walters going down under a challenge from Gary Doherty inside the box, the striker adamant he should have had a penalty.
Town had to make a second change on 55 minutes, Sito coming on for the hobbling Bruce.
Blues then had a gilt edged chance to make it three, Counago robbing Doherty and setting up Haynes but he dragged his shot wide from eight yards.
Lee Croft replaced Dion Dublin in Norwich's first change midway through the second-half.
Huckerby was booked for a challenge on Quinn as the game increased a notch in tempo and tension, Town still looking the more likely to add to the scoreline. Miller firing over.
Haynes and Counago linked up again, the Spaniard twisting his way past Doherty but failing to get any pace on his shot.
Mo Camara came on for Ryan Bertrand in another change for the Canaries as the game entered the last 20 minutes.
De Vos was in the right place to clear from Croft's cross as Norwich searched for a way back into the game, while at the other end Haynes continued to find space on the right, dragging another shot wide.
Blues continued to create and waste opening, Walters escaping the Norwich defence but pulling his shot wide.
Evans was yellow carded after bringing down Haynes on the break when he threatened to break clear.
Miller and Counago swapped passes only for Marshall to deny the Spaniard from close range, Counago then firing over after spinning away from Doherty.
Counago was replaced by Velice Sumulikoski in added on time, Kieran Gibbs on for Croft, who was hurt in a clash of heads with Quinn.
No doubt there were a few sore heads for Blues fans tonight, celebrating a vital win to keep the Play-Off hopes alive ahead of a massive game at Wolves next week.
Town: Bywater, Simpson, De Vos, Bruce, Wright, Haynes, Miller, Garvan, Quinn, Kuqi (Walters 35), Counago (Sumulikoski 90). Subs not used: Rhodes, Colgan. Booked: Bruce, Quinn
Norwich: Marshall, Otsemobor, Pearce, Doherty, Bertrand (Camara 72), Huckerby, Russell, Pattison, Evans, Dublin (Croft 64, Gibbs 90), Cureton. Subs not used: Gilks, Shackell. Booked: Huckerby, Evans
Att: 29, 656
