TOWN have now lost as many home games this season as they did in the whole of their play-off campaign.
It's a startling statistic and one which will haunt Peter Jackson's side if hopes of a repeat run to the top six start to fade.
To avoid such a fate, Town need to cut out the basic errors which were punished so ruthlessly by much-fancied Tranmere - a team suffering the same fluctuations in fortune as their opponents.
All three of the visitors' goals were gifted through defensive slackness and it proved too big a millstone for Town to carry.
At the other end, despite a brilliantly-struck equaliser from Pawel Abbott on 32 minutes, Tranmere defended well, enjoyed some strokes of luck and that was the difference between the teams.
There was plenty of enterprising football for the home contingent in a crowd of 10,324 to enjoy, especially in the first half and during a stirring late effort to rescue the result, but Town lacked a cutting edge when it came to the crunch.
Jamaican international Theodore Whitmore was the man who provided that for Tranmere, who played 3-5-2 to match Town's system and made the decision pay handsome dividends.
Tranmere went ahead after 15 minutes when Ian Gray's defence were caugth napping at a quick free-kick by Jason McAteer.
Ian Hume - subject of a bid from Preston - managed to hold off the impressive Efe Sodje and poke the ball past Nathan Clarke's challenge to leave Whitmore in the clear to score off the underside of the bar.
An Abbott snap-shot warmed the hands of John Achterberg and some neat attacking around the midfield graft of Jon Worthington suggested a home fightback even before Abbott's cracking ninth goal of the season.
Abbott was then set up for a second by a terrific early cross from Junior Mendes, but he couldn't control and it was to prove a crucial miss.
So, too, was Sodje's miscue from a Tony Carss free-kick on the hour, because Tranmere went straight upfield to regain the lead, Steve Yates caught by a deep cross from McAteer and stranded as Whitmore netted again from close range.
Town's misery was complete after 65 minutes when Gray dropped a high ball at a corner and Chris Dagnall slotted home from six yards out.
It just about summed up Town's night and it was a shame the late attacking of substitute Andy Booth, Chris Brandon, Sodje, Mendes and Abbott didn't count for more.
MK Dons now have to pay at the Galpharm on Saturday.
Next: Man of the Match >>>
MAN OF THE MATCH: Jon Worthington
JUST pipped skipper Efe Sodje to the award with his super battling in midfield. Both he and Sodje did their best to get some spark into Town but it was not to be their night
HOW THEY RATED:
Ian Gray Dropped the ball to concede the third and was off with his kicking. Made a fine stop earlier from Whitmore's shot Rating: 5/10
Andy Holdsworth Involved in some bright early moves and kept going, but didn't make the same sort of impact in the second half Rating: 5/10
Anthony Lloyd Sent the pass through for Abbott's goal and often found space, but he was blocked on the best of his forward runs Rating: 5/10
Steve Yates Made a brilliant tackle to prevent Dagnall scoring on the break but was caught out for Whitmore's second goal Rating: 5/10
Efe Sodje Raw commitment from the skipper, who won header after header. He did everything possible to rally a Town recovery Rating: 7/10
Nathan Clarke Made some wasteful passes but also caught the eye with breakneck defending at times allied to sensible cover Rating: 6/10
Tony Carss Worked tirelessly and put some excellent supply into the box, but nothing seemed to drop for his colleagues Rating: 6/10
Jon Worthington Showed real competitive edge in the centre and drove the team on even when things weren't going their way. Splendid Rating: 8/10
Chris Brandon Fired an early shot over the bar and attacked well, setting up great chances for both Abbott and Mendes in the box Rating: 6/10
Pawel Abbott Scored a cracking ninth goal of the season to put Town level but just couldn't make one of his other chances count Rating: 6/10
Junior Mendes Did some clever work on the ball and on the break but frustrated in his efforts to score in a fifth successive match Rating: 6/10
Tranmere Rovers: Achterberg, Taylor Roberts, Jackson, Sharps, Hume (Zola 77), Rankine, Goodison, Whitmore, Dagnall (Hall 83), McAteer (Harrison 77). Subs not used: Howarth, Beresford.