Iliman Ndiaye looked to have rescued a point for the Blades on the stroke of 90 minutes, and when the fourth official added on five minutes there was hope inside Bramall Lane that they could go on to nick a winner.
But Reading, who had led since the first half thanks to a comprehensive finish from former Owl Lucas Joao, had other ideas and instead went up the other end and scored a winner, defender Tom McIntyre left all alone to poke home after the ball was knocked down into his path.
The defeat sees United miss the chance to further establish themselves in the play-off places, and they can count themselves fortunate that Middlesbrough only managed to draw with Bournemouth and Blackburn were beaten away at Peterborough.
Here’s how our man rated the Blades players ahead of Monday’s now even more pivotal clash away at Bristol City.
5. Ben Davies 3
Made Joao's opener easier than it had to be with his defensive position, enabling Laurent to send the former Owl free on his right foot to lash past Foderingham. Outjumped for Reading's equaliser and then missed a great chance late on from Norwood's corner Photo: Simon Bellis
6. Enda Stevens 4
Solid rather than spectacular. United could have done with better delivery from the flanks when the chances arose but he was mostly sound defensively Photo: Andrew Yates
7. Ollie Norwood 5
Had an early effort which went over the bar inside the opening minute as United started well, but they couldn't maintain that good tempo for long. Did superbly well to get Baldock out of trouble with a top tackle and his corner should have led to an equaliser, but Davies headed over Photo: Simon Bellis
8. Conor Hourihane 3
Came in for the injured John Fleck and didn't do enough to convince that he should stay in the team whenever the Scotsman returns. Decent deadball delivery but didn't offer a great deal else before he was withdrawn Photo: Andrew Yates