With Barcelona only able to draw with Getafe on Saturday, Diego Simeone’s had the chance to open up a six-point lead at the top of the table, but saw their winless run at Levante extended to six.
After going six games in all competitions without conceding a goal, Atletico found themselves behind early on when Filipe Luis diverted a corner into his own net.
The visitors pushed for an equaliser but found a resolute home side in their way, as goalkeeper Keylor Navas pulled off a string of fine saves.
And David Barral popped up to double the hosts’ lead and blow the title race wide open.
Real Madrid now appear favourites for the title – a 33rd Liga crown will be confirmed if Carlo Ancelotti’s men win their remaining games and Atletico fail to pick up three points at Barca on the final day, with the Catalan giants also still in with a shout.
The game was only seven minutes old when the hosts took the lead through the unfortunate Filipe.
Papakouli Diop swung a corner in from the right, which was missed by a group of Atletico defenders at the front post and inadvertently turned home by the Brazil international’s chest.
Atletico should have been level in the 14th minute only for Raul Garcia to see his close-range shot saved by Navas and David Villa sky the rebound over the crossbar.
Mohamed Sissoko and Diego Costa were perhaps lucky to stay on the pitch just after the half-hour when they clashed, referee Jose Gonzalez taking no action despite the Atletico forward appearing to push his head into the Mali international.