With the score at 1-0 with three minutes of the first half to go, following Curtis Jones' opener, Admiral Muskwe and George Thomas hit back, before Luis Longstaff's 90th-minute leveller for the Reds.
City’s starting line-up featured just one change to the side which faced Arsenal a week earlier as midfielder Callum Wright came in for forward Ali Reghba, who dropped out with an illness.
The Reds were ahead inside 10 minutes as Jones, the visitors’ captain, cut inside his man on the left side of the penalty area and sent a low drive into the near corner.
A goal down early on, the Foxes responded well, though, with both Muskwe and Thomas forcing decent saves from Liverpool goalkeeper Caoimhin Kelleher.
However, as the first half progressed, City’s guests in Whetstone regained control and Herbie Kane’s curler, from the corner of the area, meant Viktor Johansson needed to palm it away.
Leicester were withstanding regular assaults on their penalty area throughout the opening 40 minutes, but the pendulum was about to swing remarkably in their favour late on.
Firstly, with just three minutes to go until the interval, the ball landed nicely for Muskwe in the area before the Zimbabwe international fought off a challenge from Sepp Van Den Berg.
The young Liverpool defender could do little to stop Muskwe’s curler from flying into the top corner, sparking jubilant celebrations among the Club’s Under-23s squad.
It got even better for City, though, seconds before the whistle was blown as Muskwe turned provider for Thomas, who powered a brilliant first-time effort past Kelleher to make it 2-1.
Despite having been second best at times during the first half, the Foxes emerged from the tunnel with intent, carving out several opportunities to extend their lead.
Ten minutes into the second spell, Callum Wright galloped down the wing – and played in Hirst to sting the fingertips of Kelleher – before taking it upon himself to loft a the rebound narrowly over.
While City undoubtedly needed Johansson to be in good form late on, the saves which the Sweden Under-21s international did make were relatively routine.
However, with effectively the last kick of the game, Longstaff was there at the far post to bundle it in for Liverpool and seal a point for the visitors.
Admiral Muskwe wheels away after scoring City's equaliser.
Just as it seemed Liverpool would go in at the break with a deserved lead, the Foxes pounced through Admiral Muskwe and then George Thomas, turning the match on its head.
It galvanised City, giving them something to protect, and it injected intensity into their display. While City will have been disappointed not to win it, it still played a role in sealing a sixth point of the season.
After a nervous start, Leicester's youngsters settled into the match.
Speaking on LCFC TV, former Fox Matt Elliott said: "Playing alongside George Thomas in midfield, Kiernan Dewsbury-Hall has applied himself superbly. He broke up play, showing bits and pieces of quality, so for me, Dewsbury-Hall just edges it over George Hirst, who really put in a lot of effort as well."
Where does it leave us?
Defender Darnell Johnson attempts to drive out from defence with the ball.
Leicester remain eighth in Premier League 2 Division 1 with six points from as many matches - level on points with Brighton & Hove Albion.
Under-23s captain George Thomas quickly made it 2-1 at Holmes Park.
City’s youngsters head to Glanford Park on Tuesday night for their maiden leasing.com Trophy group stage fixture of the season against Scunthorpe United (7:45pm BST kick-off).
City: Johansson; Clark (Eppiah 90'), Johnson, Ughelumba, L. Thomas; Dewsbury-Hall, G. Thomas, Leshabela; Wright (Shade 72'), Hirst, Muskwe (Daley-Campbell 79')
Subs not used: Davies, Tee
Goals: Muskwe 42’, G. Thomas 45’
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