Ross County are out of the Betfred League Cup just four months on from lifting the trophy after defeat by Alloa at the Indodrill Stadium.
League One hosts Alloa were ahead inside 11 minutes through strikes from Jordan Kirkpatrick and Jon Robertson.
The holders responded and were level just 10 minutes level through cup final hero Alex Schalk, and Brian Graham.
But Calum Waters made it 3-2 to ensure Jim McIntyre’s Premiership side cannot qualify from Group D.
Heavy rain before kick-off made conditions on the newly laid artificial surface difficult, and it was the home side who adjusted better.
Greig Spence teed up Kirkpatrick who fired low past County goalkeeper Scott Fox.
Then Iain Flannigan set up Robertson to slot the ball home for the second.
Michael Gardyne left Graham with the easiest of tap-ins from an inch-perfect cross to start the recovery.
Schalk, who scored County’s winning goal in the cup final against Hibernian last season, powered home past Neil Parry to make it all square.
Gardyne then hit the crossbar but the hosts always looked more likely to find the winner and Waters obliged with 18 minutes left.