Strikers Dave Kitson and Nicky Forster rescued the Royals with goals on 73 and 83 minutes after Danny Dichio's first-half lob had put the visitors ahead.
Millwall needed victory to realistically keep their own play-off hopes alive and looked on course for just that as they led with 17 minutes left.
But Reading boss Steve Coppell, handed a contract extension by the Berkshire club just three hours before kick-off, threw on veteran striker Les Ferdinand in a bid to shake things up with time running out.
It proved a master stroke, though it was top scorers Kitson and Forster who grabbed the headlines.
Kitson slotted home an Ivar Ingimarsson pass from close range for his 17th goal of the season on 73 minutes and Forster completed the fightback with a clinical header from Paul Brooker's left-wing cross seven minutes from time.
Reading dominated the game, but struggled to create enough clear-cut chances to seriously test Lions keeper Andy Marshall in the first half.
Millwall captain Matt Lawrence was alert to block a goalbound shot from Steve Sidwell on nine minutes after Marshall had punched clear from Andy Hughes' corner.
And the lively Sidwell was unlucky to see a rising shot fly just over Marshall's bar after Glen Little's threatening run had been blocked on the edge of the penalty area.
Yet it was Millwall who went in front with their first attempt on goal as Danny Dichio made a crucial breakthrough.
The striker, who scored the winner when these two sides met at The New Den in August, was quick to pounce when Ibrahima Sonko misjudged Tony Craig's punt forward and Dichio's first-time lob caught out keeper Marcus Hahnemann who could only watch as the ball drifted into the top corner.
Reading's reaction was impressive and they deserved the breakthrough handed to them by Kitson, who had already seen justifiable claims for a penalty turned down.
Then Forster, who himself has been offered a contract extension, celebrated with the late winner.
There was still time for Paul Robinson to rifle over for Millwall late on, while Ferdinand was denied a stunning third for Reading with a long-range effort that keeper Marshall did well to turn round a post.