In front of a full house on Filbert Way, the Foxes were up against an experienced Reds outfit who - with Philippe Coutinho back among their ranks - looked dangerous at every turn in attack.
Following the interval, Leonardo Ulloa sustained an injury while covering for his colleagues at the back, paving the way for Okazaki to continue his rich goalscoring form this season.
The Japan international, who recently helped his country qualify for the 2018 World Cup, made an instant impact for Shakespeare’s men, driving them forwards whenever possible.
His industrious nature paid dividends on 65 minutes when Iborra headed it down into his path before he twisted and turned in the box and picked his spot in Danny Ward’s bottom corner.
Buoyed by their one-goal advantage, City pressed forwards in numbers and they were rewarded for their attacking intent when Slimani located the top corner from 25 yards to make it 2-0.
Late on, in a move which contributed to the feel-good factor on Filbert Way, Shakespeare then handed a cameo to youngster Hamza Choudhury, who featured for eight minutes.
Shinji Okazaki celebrates scoring the opener against Liverpool in the Carabao Cup.
It was a moment which flipped the match on its head and changed the direction of travel for City.
For much of the first half, it seemed a matter of time until Liverpool’s pressure would tell, but Okazaki’s opener just after the hour-mark put Leicester on the front foot.
Aleksandar Dragović congratulates Islam Slimani after scoring City's second.
While Okazaki’s impact was key for the Foxes, Slimani’s finish to make it 2-0 was a moment which will live long in the memory for the Blue Army.
The skill required to find space and look up before executing a perfect finish from distance was a timely reminder of the Algerian's attributes in attacking positions.
What does it mean?
Matchday Live Podcast: Episode 7
Listen to the action and reaction as Shinji Okazaki and Islam Slimani fired Leicester into the fourth round of the Carabao Cup.
City will be in the pot for the Round 4 draw of the Carabao Cup, which you can follow on the Club’s official channels on Wednesday evening.
So far in the draw; Middlesbrough, Bournemouth, Norwich City, Bristol City, Crystal Palace, West Ham United, Leeds United, Wolves, Swansea City and Tottenham Hotspur.
Shakespeare Assesses Cup Victory
Craig Shakespeare spoke to LCFC TV after his side's spirited performance against Liverpool which saw them overcome the Reds 2-0 at King Power Stadium.
For the second time in just five days, Klopp’s side return to King Power Stadium on Saturday for what is likely to be another tough clash in the Premier League (5:30pm kick-off).
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