City more than matched their League One opponents throughout the game and with Alan Power having crashed a volley against the woodwork went into the break a goal to the good when Jamie Taylor produced a sublime finish in first half stoppage time.
The tie appeared to be City's but with just four minutes remaining George Bowerman headed home after the Imps' defence failed to deal with a long throw into the danger area.
The draw means that the will have to battle it out again on Tuesday 13th at the Banks's Stadium for a place in the second round.
Peter Gilbert replaced John Nutter at left-back and skipper Gary Mills returned to the centre of the park as the Imps welcomed League One Walsall to The 12th Imp Sincil Bank for this FA Cup with Budweiser First Round Proper tie. Mills' return saw Dan Gray drop to right-back with Paul Robson joining Nutter amongst the substitutes.
After a morning of heavy rain blur skies and bright sunshine greeted the two teams as they were led out of the tunnel by referee Scott Duncan and once the pre-match formalities were done and dusted, Walsall kicked off attacking the Bridge McFarland Stand.
City started brightly with Jamie Taylor quickly in the action up front, although it was the visitors who were the first to press with a quick counter-attack after a long Dan Gray throw-in was cleared ending with an offside flag saving the Imps.
Both sides then took their time to settle into proceedings with some patient build-up play from the Saddlers leading to the game's first corner which was headed goalwards by Andy Butler but claimed easily by Paul Farman.
Another Walsall corner quickly followed as the visitors stepped up the pressure again; this one being played to the edge of the area before being drilled over by Jamie Paterson. City's response saw Taylor latch on to a long ball forward by Gray only for 'keeper David Grof to sprint off his line and block on the edge of the box.
Mills then tried his luck from range with his 30-yarder dipping just over the bar before Taylor and Power combined to win a corner on the City right but the flag-kick was easily dealt with by the Walsall defence.
In the 20th minute a Gray throw-in was half-cleared as far as Power who saw his volley from the edge of the box crash against the woodwork before Gilbert's follow-up effort forced Grof to scramble across his box and tip behind.
After another quiet spell, things livened up shortly after the half-hour mark when Taylor appeared to be dragged to the floor by Walsall skipper Andy Butler as the last man. Referee Duncan was having none of it though and calmly waved play-on, much to the annoyance of the City crowd and manager David Holdsworth who was quick to remonstrate on the touchlines.
Adam Smith then saw a low drive palmed away by Grof before Taylor was flagged offside as he went for the loose ball; City continuing to more than hold their own against their higher league opposition.
A Mills free-kick led to a corner as the clock ticked into its 44th minute but Boyce's flicked header was hacked away. As Walsall responded a foul by Fofana led to a Saddlers free-kick but this ended when referee Duncan spotted a push on a City man in the packed area.
With the half in one minute of added time, City edged themselves in front with a goal of top quality from in-form Jamie Taylor. Gray was the man with the assist with a clever ball over he top but the goal belonged to Taylor who took a touch before spotting Grof off his line and lifting a superb effort for his ninth of the season.
There was still time for Walsall to respond with Adam Chambers forcing Paul Farman to tip behind but the half ended before the corner could be taken.
HT: Imps 1 Walsall 0
Both sides emerged unchanged for the start of the second half and the Imps were quickly out of the traps with a Power free-kick deflecting behind for a corner three minutes in; Gilbert coming close to connecting with Power's delivery from the quadrant before Walsall scrambled clear.
The Imps remained on the offensive, giving their opponents no time on the ball and looking threatening themselves when in posession, with Sheridan winning another corner. When this came in, Taylor was denied by a fine one-handed Grof save before Power's follow-up cross was flicked off Taylor's head by Dean Holden.
Walsall made the first change of the game in the 58th minute with Jake Jones coming on for Ashley Hemmings and he was quickly looking to get in on the action as his side won two corners in quick succession.
City then withstood a brief spell of Walsall pressure before attacking themselves with Taylor having a snap-shot deflect behind for a corner which was then scrambled away after Boyce and Sheridan both threatened to double the advantage
A second Saddlers switch saw Aaron Williams replace Will Grigg in the 71st minute before good work by Sheridan saw him draw a foul out of his marker for a free-kick wide on the right flank. This ended, however, with Taylor penalised for a push as he went up for Smith's delivery.
A Walsall attack was then halted by Miller for a corner which was eventually cleared by Mills before a double City switch saw Colin Larkin and Nicky Nicolau come on for Adam Smith and Alan Power. Richard Taundry replaced Jamie Paterson for the visitors at the same time.
With the game in its last nine minutes a Purkiss cross led to a Walsall corner which was headed well wide by James Chambers. Purkiss then saw yellow for a crude challenge on Sheridan. Vadaine Oliver then replaced goalscorer Jamie Taylor.
Walsall gave themselves a fighting change with just four minutes remaining when a long throw-in was flicked on at the near post and there in the box was George Bowerman to head goalwards with his effort beating Paul Farman's desperate attempt to keep the ball out.
City's response saw Oliver head a long Gray throw over the bar whilst at the other end another Walsall throw ended up with the Imps gaining a goal-kick. The Fourth Official then indicated a minimum of four added minutes to be played.
Sheridan and Nicolau both fired wide as the Imps pushed for a late winner but in the end the teams will have to battle it out again on Tuesday 13th at the Banks's Stadium for a place in the second round.
FT: Imps 1 Walsall 1
City: Paul Farman, Dan Gray, Andrew Boyce, Tom Miller, Peter Gilbert, Gary Mills, Mamadou Fofana, Jake Sheridan, Adam Smith, Alan Power, Jamie Taylor.
subs: Paul Robson, John Nutter, Vadaine Oliver (for Taylor 84), Nicky Nicolau (for Power 79), Geoffrey Gouveia, Colin Larkin (for Smith 79), Jake Turner.
goals: Taylor (45+1)
Walsall: David Grof, Andy Butler, Dean Holden, Nicky Featherstone, Adam Chambers, Will Grigg, Jamie Paterson, Ashley Hemmings, Ben Purkiss, George Bowerman, James Chambers.
subs: Richard Taundry (for Paterson 80), Jake Jones (for Hemmings 58), Aaron Williams (for Grigg 71), Kieron Morris, Paul Downing, James Walker, James Baxendale.
goals: Bowerman (86)
bookings: Purkiss (84)
Referee: Scott Duncan
Assistants: Mark Dwyer & Paul Cook
Fourth Official: Keith Lawson
Attendance: 2,032 (358 visiting supporters)