Liverpool were just seconds from a famous European victory against Olympiakos in the cauldron of passion that is the Olympic Stadium.

	Steven Gerrard scores Liverpool's second goal against Olympiakos (CliveBrunskill/Allsport)

After producing defending in domestic matches that has seen them held up to ridicule, the Merseysiders performed magnificently to lead twice and hit the woodwork three times in tonight's Uefa Cup third round first-leg clash.

Nicky Barmby put them ahead in the first half before Greek international Alexios Alexandris pulled Olympiakos level midway through the second period.

But Liverpool struck back instantly with a fine Steven Gerrard header and it looked as if they would hang on for victory before Alexandris struck again in injury time.

Liverpool arrived in Athens with a massive question mark over the quality of their defending but the likes of Sami Hyypia, Markus Babbel and Jamie Carragher were outstanding.

Olympiakos have not lost a home European match in four years but Liverpool frankly deserved to go home with a victory.

Emile Heskey was in outstanding form again and with Gerrard and Danny Murphy running the midfield the vast home crowd was silenced for long periods and the Greeks must now fear coming to Anfield in a fortnight.

Admittedly Olympiakos have all the Champions League credentials but Liverpool dug deep into the memory bank of their glorious European past to claim a result that will give them immense confidence for the return - and maybe do something to improve their domestic form as well.

This was by far Liverpool's stiffest European task in years against a side who had gone 15 Champions League home matches on the trot without defeat, winning an impressive 11 of those.

Olympiakos only narrowly failed to reach this season's second phase, hence their appearance in this Uefa Cup third-round match, and they were expecting to march into the last 16.

An intimidating crowd have had a lot to do with that sequence but the Greek champions for the past four seasons can also boast an amazing 41-year record in all European competitions of just nine defeats in 65 home legs, just to further underline Liverpool's task.

Liverpool, after struggling through against mediocre opponents Rapid Bucharest and Slovan Liberec, now saw just what it is like in with the big boys if they do finally make that step up to Champions League status at the end of the season.

Stephane Henchoz was dropped, with Jamie Carragher back in defence, and improvement on recent form was clearly needed against a side fielding six Greek internationals, many of whom will face England next year in the same Olympic Stadium in the World Cup qualifiers.

Liverpool, met by a fearsome barrage of firecrackers when they walked out, needed to show coolness and control that has been sadly lacking in the Premiership but for the opening 10 minutes they barely got out of their own half.

Manager Gerard Houllier had decided on two up front, Michael Owen partnering the returning Heskey, but they had precious little early involvement as Olympiakos spun the ball around neatly.

The first chance fell to the Greeks when Alexandris sent a curling shot from the right corner of the box that Sander Westerveld saved to his right after 15 minutes.

Then Djimi Traore brought down Christos Patsatzoglou and first Yugoslav midfielder Predrag Djordjevic with the free-kick and then Par Zetterberg with the follow up wasted the opportunity.

Traore, who had been lucky not to be cautioned for a earlier rash tackle, did go into the book on 23 minutes for a foul on Dimitrios Mavrogenidis.

Westerveld was again in action when needing to dive low to his right to hold a downward header from Brazilian star Giovanni on the half-hour mark.

Danny Murphy was next to be booked after 31 minutes for handball and Liverpool could do without these silly early bookings in an atmosphere where it would not take much for a red card to be brandished.

Traore, with a reckless tackle on Patsatzoglou, was walking a very fine line and with the Frenchman beginning to look out of his depth his later substitution by Steve Staunton was not unexpected.

Liverpool had barely got close to Olympiakos' area but stunned their hosts with a fine poached goal on 38 minutes as Heskey's flick on from Carragher's throw was powered into the net by Barmby with a fine volley.

Staunton, who had been called into the squad late from his loan spell at Crystal Palace, came on for Traore at the break and Liverpool almost grabbed a second goal on 51 minutes.

Heskey had seen one effort deflected wide before he raced on to a long ball down the right. His low cross was missed by Owen but Barmby powered in from the left and hooked a close-range shot against the underside of the bar.

The noise became deafening from the banks of home fans but Liverpool were growing in confidence and using the width of the pitch - and Heskey's strength - to worry the Greeks.

Olympiakos, however, came surging back and Babbel was booked for a foul on Djordjevic as the pressure mounted, not least on Dutch referee Rene Temmink.

Olympiakos finally drew level with a fine goal on 64 minutes when Alexandris volleyed home with an overhead kick from 12 yards following a Giovanni cross.

The stadium erupted but Liverpool, having brought on Vladimir Smicer for Owen before the restart, amazingly hit straight back and were ahead again three minutes later.

Barmby's corner from the left was powered into the net with a fine header from Gerrard.

It could have been even better when Staunton rattled the crossbar with a curling free-kick as Liverpool inched closer to a famous victory. Smicer also hit the post after being played clean through.

But in injury time Alexandris struck again, hooking home after a rare slip by Babbel, and Olympiakos had a lifeline they hardly deserved.

It took the sting out of Liverpool's display but they will believe they can finish the job now.