Gordon Durie's side went into the Lennoxtown clash only needing a point to deny their rivals a fifth successive league crown.
But second-half goals from Denny Johnstone and John Herron were enough to give the Hoops victory.
It is the second time this season Celtic have beaten their Glasgow counterparts on Under-20 duty and they now have their sights set on the championship.
Boss Durie handed starts to first-team stars Kyle Hutton, Robbie Crawford and Calum Gallagher for the derby clash, but it was the youthful Hoops side, who fielded midfielder Liam Henderson, that would take the spoils.
After a goalless first half, Johnstone broke the deadlock just before the hour mark when he met Filip Twardzik's cross and headed beyond keeper Liam Kelly.
And when midfielder Herron doubled the hosts' advantage seven minutes later, converting after being set up by winger Paul McMullan, the points were secured for Celtic as they moved to within one win of the title.
The Light Blues, who face Hearts in the SFA Youth Cup Final next week, hold a two-point advantage at the top of the table.
But, having played all of their fixtures this term, they must now hope Celtic fail to win their final game of the campaign when they face Dundee United tomorrow.