Stoke sunk Liverpool 1-0
Liverpool conceded first loss in the Premier League after being felled with minimum 0-1 away from home from tough team Stoke City.
Kenny Dalglish team made many gaps in front of Asmir Begovich, and their captain Jamie Carragher made a ridiculous penalty in the 28th minute.
It appeared a harsh decision with the Stoke forward going down easily after the former England defender put his arm around him. However, Walters got up to fire down the middle and give the hosts the lead.
The Potters are a threat from set-pieces but deadline-day signing Peter Crouch, making a debut against his former club, weakly headed wide one free-kick.
At the other end Luis Suarez, from close range, somehow failed to connect with Charlie Adam's inswinging corner to the far post.
Martin Skrtel, pushed into service at right-back, nipped in front of Ryan Shawcross to prevent the Stoke captain getting his head to Matt Etherington's free-kick as the hosts generated the early pressure.
But the opening goal, when it came, was from a simple ball over the top which caught Carragher out of position.
The Reds centre-back looked to have made good ground to get around Walters but when the Stoke forward went down with Carragher's arm around his waist referee Mark Halsey pointed to the spot and the player picked himself up to drill a shot straight down the middle of the goal.
Stoke were blocking most avenues open to Suarez - as displayed by a sprawling Shawcross who smothered one near-post shot - with two defenders on occasions but the Uruguayan still found ways of getting past.
He easily turned Robert Huth on the left and crossed to the far side of penalty area where an onrushing Skrtel appeared to be clipped by Etherington just before he blazed a shot over.
After a relatively quiet start to the second half, the match exploded into action just past the hour as Liverpool had five shots in the space of 20 seconds but still could not find a way through.
Jose Enrique's through-ball sent Jordan Henderson racing clear through the middle but he side-footed his first shot straight at Asmir Begovic, the goalkeeper made a good save from the follow-up and Matthew Upson's chest blocked the third.
However, the danger was not over as the loose ball dropped to Adam's dangerous left foot but Shawcross blocked his first effort from the edge of the penalty area and Begovic got back to stop the rebound.
The introduction of Craig Bellamy and Andy Carroll for Henderson and Dirk Kuyt ramped up the pressure on the hosts in the final 20 minutes.
But Stoke manned the barricades and with Liverpool seemingly intent on going through the middle more often than not they made it easier for their opponents to crowd them out.
Stoke were being forced back and it was midfielder Dean Whitehead who put in the crunching block tackle inside his own penalty area which denied Suarez yet again.
It is not in the Uruguay international's nature to give up and he kept plugging away, seeing his shot across goal tipped wide by Begovic.
Stewart Downing cut inside from the right to blaze over, Carroll had a claim for a penalty when his shot appeared to hit the arm of Whitehead while Bellamy headed Downing's cross wide.
Suarez was convinced he should have had a spot-kick when his cross hit Upson's arm but neither referee Mark Clattenburg nor his assistant spotted the offence.
The striker had his chance to put that wrong right in the fourth minute of added time when Begovic and Shawcross got in each other's way but he stabbed wide with the goal gaping.
Stoke were hanging on at the end - something they are well equipped and well-enough drilled to do - and they blunted everything Liverpool threw at them.
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