A powerful header from Efe Sodje four minutes before half time ended Oxford's 18 -match unbeaten home record and gave Huddersfield's promotion hopes an enormous boost.
Sodje had been involved in a spat with Oxford striker Julian Alsop when the sides met earlier in the season.
Alsop was sent off after being a adjudged to have elbowed the Nigerian International, but it was Sodje who had the last laugh when he met a Tony Carss corner to bullet home the only goal of the game.
Oxford, who remain third in the table but not in a strong a position as they were enjoyed the entire second half's possession, but could not find a way past Paul Rachubka.
The Huddersfield keeper superbly kept out Matt Robinson's vicious free kick, whilst Alsop wasted two other golden chances.
The turning point came ten minutes before half time when Oxford striker Mark Rawle found himself in acres of space on the edge of the visitors penalty area, only to hit a dreadful shot well wide of the upright.
And after 5 minutes of Huddersfield pressure, Sodje scored what turned out to be the only goal to sink Oxford.
Huddersfield manager Peter Jackson said: "It was a massive win for us today and we have now given ourselves every chance.
"A lot was said before the game, but all that matters was that we got the three points." Oxford boss Ian Atkins added: "We dominated most of the game, but we are not getting any breaks at the moment.
"Everything seems to being going against us, but we are still third and there are a lot of points still to play for." The defeat means that Oxford, who must face fellow promotion chasers Mansfield and Doncaster later this month, are now in a batch of five teams fighting it out for the two remaining automatic promotion places.
Mansfield, Huddersfield and Torquay all now would appear to be favourites over Oxford to go straight up.