West Brom are the leading scorers in the Championship, but they have real problems at the back and the plucky U's exploited them to the full.
The Baggies had doubled the U's in the Essex club's first season at this level last year and it looked like they are on course for another win when veteran striker Kevin Phillips fired them into a six-minute lead.
Phillips was back in the side after missing the last two games with an ankle injury and he latched on to a big kick upfield from keeper Dean Kiely, benefiting from some hesitancy by defender Pat Baldwin to lob the ball over advancing keeper Aidan Davison.
This was Phillips' seventh goal of the season from just eight appearances, but West Brom's lead lasted just two minutes.
Johnnie Jackson was upended just outside the box by full-back Carl Hoefkens, and danger man Mark Yeates curled another of his trademark free-kicks into the roof of the net.
Former Tottenham winger Yeates has been scoring goals for fun this term, especially from free-kicks, and he was the star man in this contest.
Colchester were ahead in the 19th minute thanks to Kevin Lisbie, who burst on to Jackson's long pass before cutting inside defender Martin Albrechtsen and beating keeper Kiely with a low drive that sneaked in at the far post.
West Brom were level before the break, as Manchester City loanee Ishmael Miller rose high to head home James Morrison's pinpoint cross.
The end-to-end entertainment continued in the second half but there was only one more goal and it came from a familiar source.
Yeates was tripped in the penalty area by Albrechtsen on 68 minutes and the Dubliner picked himself up to convert the spot-kick, sending keeper Kiely the wrong way.
It was Yeates' seventh goal of the season, but the first penalty of his career.
The Baggies have picked up just four points on their travels this season and Yeates' penalty knocked the stuffing out of them for the last quarter of the game.
This was Colchester's third win of the season and puts them in good heart for the East Anglian derby at Ipswich on Tuesday evening.