Sri Lanka 232 for 9 (Mathews 85*, Wood 3-40, Archer 3-52) beat England 212 (Stokes 82*, Root 57, Malinga 4-43)by 20 runs
Leeds: England were strangled into a shock 20-run defeat by Sri Lanka that dented their hopes of reaching the World Cup semi-finals and breathed life into the tournament.
Chasing 233 on an increasingly difficult pitch, the hosts were smothered by a brilliant Sri Lanka bowling performance in a compelling contest at Headingley.
When Ben Stokes was joined by last man Mark Wood, England still needed 47, but Stokes clubbed 24 from nine deliveries to make a deafening crowd believe.
Wood, though, edged Nuwan Pradeep behind to leave Stokes stranded on 82 not out and England 212 all out.
They had earlier restricted Sri Lanka to 232-9, with Angelo Mathews' painstaking 85 proving to be a match-winning innings.
England stay third in the 10-team table, but their three most difficult group games - against Australia, India and New Zealand - are still to come.
Sri Lanka climb to fifth, only two points behind England, their unlikely hopes of reaching the semi-finals still alive.
Before this match, there was the danger England, Australia, India and New Zealand would pull away to leave the elongated group stage nothing more than a procession towards the semi-finals.
On a sun-kissed day at Headingley, amid unbearable tension in front of crowd fully invested in the action, Sri Lanka produced a display full of fight and spirit that has injected much-needed intrigue into the tournament.
At the same time, they have raised questions about an England side that hit a world record 25 sixes in demolishing Afghanistan at Old Trafford on Tuesday, but that failed to adapt to the difficult batting conditions in Leeds.
Some, like James Vince and Moeen Ali, fell in infuriating fashion, while Jonny Bairstow and Jos Buttler were fooled into playing across the slingy Lasith Malinga, who claimed 4-43.
Just like when their fielding cost them against Pakistan, England helped engineer their own downfall and, as it stands, will have to find at least one win from their remaining games if they are to make the last four.
While England were putting in an excellent display with the ball and in the field, Mathews crawled along, looking entirely like a batsman whose previous highest score in this tournament was just nine.
Only late on did he show any intent, but by that time he was rapidly running out of partners.
When Sri Lanka were 3-2 after winning the toss, the day could have been short, only for Avishka Fernando to sparkle for 49, including two sixes pulled off Archer.
After he uppercut Wood to third man, England spinners Moeen and Rashid bowled in tandem to suffocate Sri Lanka.
It was Rashid, looking back to near his best, who had Kusal Mendis well held by Eoin Morgan at mid-wicket and then, next ball, Jeevan Mendis caught and bowled.
Wood and Archer worked through the lower order, with Wood particularly impressive - his yorker to bowl Malinga was clocked at 93mph.
All the while, Mathews plodded on. At no point was he interested in playing the modern, ultra-aggressive one-day game, but he had the application to battle with both himself and the England bowlers.