Sheffield United's automatic promotion hopes were dented after Alan Smith's first-half header for MK Dons consigned Danny Wilson's side to defeat.
The result means they are just one point ahead of city rivals Sheffield Wednesday with two games left to play.
Smith headed home from close range to open the scoring while Gary MacKenzie also hit the post for MK Dons.
Jabo Ibehre later fired a shot against the post for the Dons, while Daniel Powell was also sent off for the hosts.
MK Dons remain fourth, level on points with Huddersfield in fifth, with their play-off place already confirmed.
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Sheffield United manager Danny Wilson told BBC Radio Sheffield:
"We didn't have enough tempo and energy in our play in the first half.
"We created one or two little opportunities, but didn't make the most of it and offered too much possession to MK Dons.
"We had a couple of escapes. They hit the post a couple of times.
"But we're quite frustrated we didn't put the few chances away that we had."