Sergio's men claimed victory at La Rosaleda courtesy of goals to Alvaro Gonzalez and Sergio Garcia, but not before they were reduced to 10 men.
Diego Colotto, seconds after gracing the field as an 80th-minute substitute, incredulously flung his hand at a goal-bound effort from fellow sub Javi Guerra.
The brain snap saw Colotto dismissed and a penalty awarded, but Espanyol goalkeeper Kiko Casilla was the hero - diving low to his left to keep out Nordin Amrabat's spot kick.
Malaga, who were trailing 1-0 at the time, continued to push to earn a point against their undermanned opponents, with Ruben Duarte using his head to deny the hosts an on-target shot moments later.
Garcia sealed the three points late in injury time for the visitors, their second league win on the road in their past four trips.
Espanyol (eighth, 29 points) ended a two-match losing run, and inflicted back-to-back losses on Malaga - who sit seventh on 35 points.
Sevilla climbed to fourth with a home rout of Cordoba, with both sides finishing with 10 men.
Grzegorz Krychowiak and Carlos Bacca struck in the shadows of half-time, before Iborra's effort in the 76th minute completed the scoring.
Patrick Ekeng was earlier sent off for Cordoba in the 54th minute, while Iborra's goal came three minutes after Krychowiak saw red.
Real Madrid bounced back from their last-start loss to Atletico Madrid, downing Deportivo La Coruna 2-0 to move four points clear at the top.
Granada and Athletic Bilbao played out a 0-0 draw, the Basque club keeping a second straight clean sheet on the road.
The hosts were down a man for the final 22 minutes, after Emanuel Insua was dismissed.
