Cedric Konan scored the winning goal for Lecce in the 54th minute after connecting with a Mirko Vucinic cross and firing the ball past an Milan unsuspecting keeper Dida.
With this result, Milan fell nine points behind leaders Juventus with a tally of 70 points, while Lecce come second from the bottom with 24 points.
Milan dominated the pitch throughout the first-half despite the absence of several top players including Ukrainian striker Andriy Shevchenko and Brazilian Kaka, but showed a sudden decline of form in the second-half allowing Lecce to seal the game in their favor.
Meanwhile, Juventus were held to a goalless draw by bottom club Treviso in a mediocre performance that saw a host of wasted chances.
Juventus boss Fabio Capello fielded most of the team’s star players in an effort to overcome last week's disappointing 2-0 defeat to Arsenal in the first leg of their Champions League quarter-finals.
Juve top the Serie A standings with a tally of 79 points, while Treviso tail the table with 16 points, only a few points away from being relegation to the second-division.
Elsewhere, Santiago Solari scored twice as Inter Milan beat Messina 3-0.
Solari opened the score for Inter in the 15th minute, before Obafemi Martins doubled their lead three minutes later.
The Argentinean sealed Inter's victory with their third goal, and his second, in the 26th minute.
Inter hold third place in the Italian league standings with a tally of 68 points, while Messina come 18th with 28 points.