Phil Mulryne scored a vital late winner just four minutes after coming on as an 82nd-minute substitute as Norwich took a huge step towards Premiership football.
Mulryne took advantage of a lucky ricochet off referee Neale Barry to volley home the winner at the Madejski Stadium, which gives the Canaries a two-point cushion over West Brom, and an 11-point advantage over third-placed Sunderland.
For Reading, who rarely threatened England squad goalkeeper Robert Green's goal, the result was another major blow to their play-off hopes following their defeat at lowly Bradford on Saturday.
It was an open start to the match and Norwich midfielder Kevin Cooper showed he was not scared to shoot from long range with two early efforts which flew well off the mark.
Mathias Svensson and Darren Huckerby combined superbly to create the first real opening of the match for the visitors.
The Swede flicked on Green's long clearance, and Huckerby fired in a low right-footed shot from 18 yards which Ashdown tipped onto the outside of his left-hand post.
At the other end, Green produced a superb save diving low to his right to parry Steve Sidwell's drilled strike from the edge of the penalty area.
The hosts again threatened when Nicky Forster - making his first start for the Royals after nearly three months out with a stomach injury - headed Paul Brooker's right flank-cross straight at Green.
Just before the break Cooper's vicious left-footed drive from 25 yards nearly squirmed under Ashdown, but the Reading goalkeeper was able to gather the ball at the second attempt.
Reading manager Steve Coppell made a change at half-time with top scorer Shaun Goater coming on to replace Brooker but Norwich were the first to threaten as Huckerby's cross shot from the left was well caught by Ashdown.
Huckerby then had a decent appeal for a penalty turned down after he was clumsily tumbled over by Ivar Ingimarsson, and then Reading goalkeeper Ashdown had to be quickly off his line to superbly snatch the ball off the toe of Damien Francis.
The visitors continued to pile on the pressure, and Francis was again thwarted by the home stopper just moments later as Ashdown made a sprawling stop to keep out the Norwich midfielder's shot from point-blank range.
However the Canaries finally broke the deadlock in the dying seconds, thanks to a supreme piece of opportunism from Mulryne, who had been introduced as a late replacement for McVeigh.
Dean Gordon attempted to clear Marc Edworthy's long throw but the ball cannoned off the referee into the path of Mulryne, who spun to fire an unerring right-footed volley into the top-left corner of the net from 15 yards.
The goal was Mulryne's first strike away from Carrow Road since the corresponding fixture last season, and could prove priceless in Norwich's bid to return to the top flight after an absence of nine years.
Teams
Reading Ashdown, Murty, Hughes (Gordon 77), Williams,
Ingimarsson, Brooker (Goater 45), Sidwell, Harper, Salako,
Forster, Kitson.
Subs Not Used: Young, Morgan, Owusu.
Booked: Ingimarsson.
Norwich Green, Edworthy, Drury, Mackay, Fleming,
Cooper (Brennan 90), Holt, Francis, McVeigh (Mulryne 82),
Huckerby, Svensson (Roberts 85).
Subs Not Used: Crichton, McKenzie.
Booked: Francis.
Goals: Mulryne 86.
Ref: N Barry (N Lincolnshire).