Grant Leadbitter crashed home an equaliser as Ipswich fought back from two goals down to deal Hull's promotion hopes another blow.
Leadbitter had just converted a penalty when he arrowed a half-volley past Hull goalkeeper Vito Mannone.
Hull had taken a two-goal lead courtesy of Robbie Brady's deflected shot and Robert Koren's superb finish from the edge of the penalty area.
The Tigers are now two points outside the play-offs.
Neither side had threatened until Hull took the lead. Matty Fryatt slipped a pass inside while on the edge of the area - and Brady's low shot took a deflection, wrong-footing Alex McCarthy on its way into the bottom corner.
Ipswich began the second half on the front foot but Hull snatched a second goal through Koren.
Substitute Aaron Mclean provided a headed pass from the right and retired Slovenia international Koren rifled a 20-yard shot into the bottom corner.
But Ipswich hit back with two goals in three minutes. First Leadbitter buried a penalty after Mclean's foul on Tommy Smith in the area.
Leadbitter then completed the comeback in spectacular style, firing in Martin's pass on the half-volley from 20 yards.