Iceland 2 Northern Ireland 1:Northern Ireland have only an outside chance of qualifying for Euro 2008 after their second successive defeat.
Just like in Latvia at the weekend, they were undone by an own goal.
It was Keith Gillespie's turn to rue his bad luck a minute from time with the touch which sealed a victory for Iceland.
In Latvia, Chris Baird's own goal had sealed a narrow win for the hosts.
You had to feel for Northern Ireland as they raised their game after a bad start. They almost made the breakthrough as well inside the first minute with Warren Feeney testing goalkeeper Arni Arason with a fierce shot.
But Iceland took the lead after just six minutes when Northern Ireland were caught cold. A swift move saw Gunnar Thorvaldsson deliver a good ball into the area and Armann Bjornsson was the first to react and smashed a shot beyond goalkeeper Maik Taylor.
Northern Ireland hit back in the 15th minute when Chris Brunt delivered a corner to the back post. Jonny Evans escaped his marker to flick in a header that was deflected to safety.
Evans, who had been troubled by a groin injury, then needed treatment in the 19th minute following a late challenge from Bjornsson, which saw the Icelandic player booked.
Northern Ireland raised the tempo and Sammy Clingan made space in the 28th minute on the edge of the area, only to fire his effort wide of the post.
They should have equalised three minutes later when Evans cleared the bar with his close range shot after Arason pushed away a free kick from Brunt.
This was a good spell of pressure and Evans complained unsuccessfully he had been impeded when Michael Duff played the ball in after 33 minutes.
Feeney was finding it difficult to get into the game and was booked in the 41st minute for a challenge on Arason following a short back pass from Hermann Hreidarsson.
Then Kari Arnason was allowed room to manoeuvre in the 47th minute and latched on to a pass from Thorvaldsson. He got a decent enough strike on the ball but Taylor got down quickly to smother his effort.
But Northern Ireland were beginning to turn the screw and Brunt was a danger from set-pieces. He delivered a good corner from the right after 63 minutes and Arnar Vidarsson was happy to concede a corner.
Nigel Worthington's side drew level in the 71st minute thanks to Healy's 12th goal of the campaign.
The Fulham striker scored coolly from the penalty spot after being upended by Ragnar Sigurdsson.
But then with a minute of the 90 minutes to go they were undone when Gillespie put the ball into his net, under pressure from Gudjohnsen after Gretar Steinsson played the ball in.
ICELAND: Arason, Kristjan Orn Sigurdsson, Ragnar Sigurdsson, Ingimarsson, Hreidarsson, Arnason, Vidarsson, Steinsson, Hallfredsson, Thorvaldsson, Bjornsson.
NORTHERN IRELAND: Taylor, Baird, Duff, Evans, McCartney, Gillespie, Clingan, Davis, Brunt, Healy, Feeney.
Referee: Yuri Baskakov (Russia)