Jose Luis Morales gave the visitors the lead on the half-hour mark with a deflected strike from just inside the area to deceive keeper Jan Oblak, while Jorge de Frutos knocked into an empty net to score the second in added time after Oblak had committed himself forward to contest a corner.
After a poor first half, Atletico came out fighting in the second but could not beat Levante keeper Daniel Cardenas, who made a total of 10 saves including an outstanding late stop to deny substitute Thomas Lemar.
Luis Suarez hit the post with a vicious free kick while Angel Correa saw a goal ruled out for a foul by Suarez.
But Levante, who had held Diego Simeone's side to a 1-1 draw three days earlier, clinched their first ever away league win over Atletico in 17 attempts when De Frutos surged forward and launched the ball into the net from just past the halfway line.
Atletico went on a relentless run of eight league victories since losing to Real Madrid on Dec. 12.
However, they have taken only five points from four games in February, ceding ground in the title race to champions Real as well as Barcelona, who can move to within six points of the leaders if they beat Cadiz on Sunday.
"We're not happy at all with the result," said Atletico defender Mario Hermoso.
"We had so many attempts on goal but weren't able to score. And if you don't score any goals and keep letting them in you'll be in trouble.
"But I'm sure we'll start scoring soon, we're the same team that got to this stage. It's not easy for us right now but this is a marathon not a sprint."
Simeone said his side will search for solutions from within following the loss.
"I'm not looking for excuses. Coaches have to find solutions. In the second half we did, and we have to be ourselves, with the players who are here," he said.
"Seasons are always the same, there are difficult moments, but for everyone. Those who are strong in the bad times are those who will achieve their objectives."