Visiting Macclesfield took the lead in the 12th minute when Matthew Barnes-Homer cross for his strike partner Waide Fairhurst to fire past Paul Farman but City rallied and levelled thanks to Jamie Taylor's third goal of the season shortly after the half-hour mark.
The game came to life in the final quarter of the game, however, with referee Ross Joyce awarding the Silkmen a penalty after he deemed Andrew Boyce's challenge on John Paul Kissock was inside the box. Although Farman denied Fairhurst from the spot, he was unable to keep out Barnes-Homer who followed up to net after his initial effort was kept out by the City stopper.
Macclesfield substitute Chris Holroyd made it 3-1 with his first touch for his new club and although Boyce smashed home in the last minute, it proved to be only a consolation effort as the Imps slipped to a third successive defeat.
Whilst Rob Duffy (ankle) and Adam Smith (hamstring) were ruled out of this Blue Square Bet Premier game against Macclesfield Town at The 12th Imp Sincil Bank Stadium, manager David Holdsworth was dealt a further blow prior to kick-off with Tom Miller pulling up in the warm-up with a groin strain.
With Mark McCammon and Jake Sheridan replacing Duffy and Smith respectively, teenager Graham Hutchison was handed his first team debut in place of Miller. New signing Colin Larkin was named amongst the substitutes, as was a last minute replacement in the shape of Paul Robson.
City kicked off attacking the Stacey West Stand from the first whistle but it was the Sikmen who were the first to press with ex-Town man Dan Gray conceding a corner which ended up with an offside flag going in the Imps' favour.
Gray had to be on his guard a couple of minutes later to divert a cross behind again and when this corner was floated in by Charlie Henry, referee Ross Joyce spotted a push for another City free-kick.
At the other end Jamie Taylor had a shot easily saved by Lance Cronin with Town's response seeing John Paul Kissock test Paul Farman from long range.
The visitors continued to look the more likely to break the deadlock having enjoyed by far the better of the early play and, for the third game running, City's poor start saw them go a goal down early on.
The breakthrough came with just 12 minutes on the clock; Matthew Barnes-Homer creating space down the right and when he crossed, his strike partner Waide Fairhurst had the easy task of firing past Farman from 10 yards.
City's response to this setback saw Luke Daley upended by Kissock with skipper Gary Mills' free-kick being flicked off McCammon's head by ex-Imp Nat Brown but it wasn't long before the Silkmen had their foot on the ball again, with Kieran Murtagh being upended by the back-tracking McCammon.
Despite being forced to soak up the pressure, City struck back shortly after the half-hour mark when good hold up play by Jake Sheridan following a forward ball, he laid off to Jamie Taylor who duly blasted past Cronin with the aid of a slight deflection for his third of the season.
The goal brought the City fans, and the game, to life with Mills trying his luck from range only to drill straight at Cronin but things soon calmed down again with the play centered in the middle third for the next 10 minutes or so.
When City did attack, Taylor had a shot from a narrow angle blocked by Cronin before the striker had another effort saved as he went in search of a second before the break. At the other end the Imps had Andrew Boyce to thank as he deflected a Barner-Homer shot behind following a clever reverse pass by Fairhurst.
As the Fourth Official indicated an additional couple of minutes, a Power cross was cleared by Cronin under pressure from McCammon and when Town cleared the ball Boyce was booked for a late challenge on Fairhurst.
HT: Imps 1 Macclesfield 1
It was as you were as play restarted with the first half-chance of the second half coming City's way but Daley drilled well over after Taylor created space for the winger on the edge of the box.
City forced their first corner eight minutes in following good play by Mills but his flag-kick, played short to Taylor, saw the latter fire over the stand rather than into the back of the net. A corner to Macclesfield at the other end ended up seeing Farman save superbly from Arnaud Mendy's goalbound header.
Seconds later Farman was left clutching his right knee, which he had injured during training in the week, after he collided with Kissock in the area; the Town man's appeals for a penalty being waved away by referee Joyce. When the ball eventually went out of play, physio Sam Rees was able to treat Farman who gingerly got back to his feet before taking a goal-kick.
A deflected Murtagh effort led to Town's fifth corner which was claimed by Farman, who was then cautioned after squaring up to Kissock after the pair clashed again as the went for a loose ball.
With the tackles starting to fly in, a foul on Taylor by Murtagh gave the Imps a chance from a free-kick on the left a couple of minutes later but Mills' delivery was poor and allowed Cronin to claim with ease.
As the game entered its final quarter, a double change for the Imps saw new signing Colin Larkin and Vadaine Oliver replace Luke Daley and Mark McCammon. Shortly afterwards, Town full-back Ryan Jackson pulled up before going off for treatment.
There was drama as Jackson returned as a forward ball saw Kissock go down under a Boyce challenge on the edge of the area. Referee Joyce took his time before deciding that the offence was inside the box and despite Boyce's appeals, awarded a penalty.
Fairhurst took the responsibility from 12 yards but was superbly denied by Farman who then blocked Barner-Homer's follow-up effort. The ball, however, bounced straight back to the striker who blasted into the top corner to cut short the City celebrations.
Jackson limped off with Tony Diagne coming on and as the Imps pressed for another leveller, Tayor had a flicked header bloked at full stretch by Cronin who then denied Oliver as the substitute looked to pounce on the loose ball.
Barnes-Homer was then booked for a foul on Mills and substitute Diagne joined him for kicking a ball away after his side was awarded a free-kick for offside against Oliver. A second Town change saw Peter Winn replace Kissock in the 82nd minute whilst a minute later Nicky Nicolau came on for Jake Sheridan for City.
The changes continued in the 86th minute with Chris Holroyd coming on for Fairhurst for the visitors and Town's new signing's first touch saw him latch on to a Barnes-Homer pass after Mills was caught in possession and with the City defence nowhere in sight, he lifted the ball over the advancing Farman with his second to give his side a two-goal cushion.
Gray was booked for a foul on Winn but City gave themselves a glimmer of hope with a minute remaining when Gray's cross flew across a packed area before finding Boyce at the back post; the big centre-back showed a cool head to blast a left-footed effort into the roof of the net from a narrow angle.
The Imps had a minimum of five added minutes in which to salvage something from the game and midway through these extra stages, a City corner saw Farman push forward but the kick ended up with a Nutter cross being headed wide by Oliver.
In the dying seconds a foul on Oliver inches outside the box gave Power the chance to fire goalwards and when his free-kick clipped the Town wall, Cronin gathered the ball at full stretch. City's appeals for handball against the defender in the wall were waved away by referee Joyce who brought things to a close once the ball was pumped forward.
FT: Imps 1 Macclesfield 3
City: Paul Farman, Dan Gray, Andrew Boyce, Graham Hutchison, John Nutter, Gary Mills, Alan Power, Jake Sheridan, Luke Daley, Mark McCammon, Jamie Taylor.
subs: Paul Robson, Vadaine Oliver (for McCammon 69), Nicky Nicolau (for Sheridan 83), Colin Larkin (for Daley 69), Jake Turner.
goals: Taylor (31), Boyce (90)
bookings: Boyce (45+2), Farman (65), Gray (87)
Macclesfield: Lance Cronin, Ryan Jackson, Nat Brown, Kieran Charnock, Craig Braham-Barrett, Kieran Murtagh, Arnaud Mendy, John Paul Kissock, Charlie Henry, Matthew Barnes-Homer, Waide Fairhurst.
subs: Jack Mackreth, Peter Winn (for Kissock 82), Tony Diagne (for Jackson 75), Rob Edmans, Chris Holroyd (for Fairhurst 86).
goals: Fairhurst (12), Barnes-Homer (75), Holroyd (86)
bookings: Kissock (65), Barnes-Homer (77), Diagne (80)
Referee: Ross Joyce
Assistants: Stuart Campbell & Andrew Miller
Fourth Official: Martin Parker
Attendance: 2,009 (78 visiting supporters)