In mitigation, the Foxes faced a striker crisis with Matty Fryatt beginning a three-match ban and DJ Campbell and Lewis John sidelined by injury.
But they were up against a Saints side down to the bare bones with five key defenders out injured.
Iain Hume missed one of City's few chances early on when he latched on to a Patrick Kisnorbo pass and shrugged off Andrew Davies, before firing a shot against the advancing Kelvin Davis with Shaun Newton driving the rebound over the bar.
Stern John then had a goal ruled out for offside with City having to wait until the 28th minute before their next glimpse of goal, when Jonathan Hayes blasted a Hume knockdown wide.
And it was the Saints who stunned the home crowd on the half hour mark when former Nottingham Forest striker John fired them into the lead.
Youssef Safri floated the ball to the far post where Nathan Dyer knocked it down for John to finish with a superb volley from six yards.
Apart from Richard Stearman's long-range drive which drew a sprawling save from Davis, City's response was lukewarm until Youth Academy product Andy King levelled with a shot out of the blue in time added on at the end of the first half.
There seemed little for the Southampton defence to worry about when Hayes headed back to King, who was standing 30 yards from goal.
But the Wales Under-21s midfielder made the most of the space afforded to him to curl a superbly struck left-foot shot into the top corner of the net.
Southampton began after the re-start in a positive mood which was rewarded on 55 minutes when they were awarded a penalty after Stephen Clemence was ruled to have handled inside the box.
Andrew Surman stepped up to stroke home the spot-kick with Marton Fulop going the wrong way.
The Foxes were again slow to mount a meaningful response and had their keeper to thank for not falling further behind after Fulop reacted sharply to keep out a near-post shot from Bradley Wright-P{hillips.
City's best chances of another equaliser came late on when first Kisnorbo headed Alan Sheehan's far-post corner just wide and then Clemence ended a jinking run with a shot which flew narrowly the wrong side of an upright.