Two goals from Diogo Jota either side of a strike from Mohamed Salah in the second half secured a huge win for Jurgen Klopp's embattled defending champions.
The victory revived Liverpool's flagging Champions League hopes as the Reds are now just two points behind Chelsea, who were thumped by West Brom earlier in the day.
The Gunners, following another flat performance on the night, have their European ambitions all but squished now, as they languish in ninth place, seven points behind West Ham despite playing a game more.
On that note, here are the hits and flops from the match:
Hit: Diogo Jota (Liverpool)
Diogo Jota knows no stopping!
On his return to Liverpool from a highly productive international break, which yielded three goals from as many games, Jota merely continued from where he left off with Portugal.
With the defending champions once again struggling to pull things together upfront, Jota came off the bench in the second half and struck twice.
He broke the deadlock with a close-range header off Trent Alexander-Arnold's cross and then put the contest to bed with a powerful finish beyond Leno for a third after a mix-up in the Arsenal box.
Jota now has eight goals in the league for Liverpool despite missing several months because of a knee injury. On this form, Jota could guide Liverpool deep into the Champions League, and perhaps, also them secure a place in the league's top-four too.
Flop: Pierre-Emerick Aubameyang (Arsenal)
Given just how listless Arsenal were in attack, it's hard to single out a player for their listless performance.
Martin Odegaard couldn't exert his influence in the game, while Alexandre Lacazette was a complete no-show.
However, considering he's been their chief attacking threat, a lot was expected from Pierre-Emerick Aubameyang, who was simply disappointing. The striker lacked the spark once again, was devoid of service for most of the time and rarely threatened the Liverpool defence.
Aubameyang did lay two key passes in the game, the most by an Arsenal player on the night, but surely he's ought to do more than that, right?
He was given a new contract six months ago, but unfortunately, he has failed to live up to his billing in an admittedly tough campaign.