Development Squad Beaten By Brighton In Seagrave
Evan Ferguson's first-half hat-trick proved the difference in Seagrave, with Tawanda Maswanhise's goal unable to alter the result in the Foxes' favour.
One change to the side that faced Burton Albion in the Papa Johns Trophy in midweek saw Oliver Ewing return to the XI, replacing Lewis Brunt, with Sammy Braybrooke named as captain.
The first attempt of the game fell to Ethan Fitzhugh, who, fresh from scoring on Tuesday, tried his luck when Braybrooke's corner fell to him on the edge of the area. It was off target, though, and not able to trouble James Beadle.
The winger was involved in more attacking play inside the opening exchanges, linking up with Kasey McAteer down the right before teeing up Will Alves to strike, though it was comfortable for the 'keeper to save.
For all their possession in the opening exchanges, Leicester were undone by Brighton's first meaningful attack after 10 minutes. Andy Moran threaded the ball through for Ferguson and the Seagulls' No.9 made no mistake in directing the ball under Chituru Odunze to take the lead.
That same combination proved effective once more midway through the half. Moran played in Ferguson and after taking a touch, the forward struck a low effort that hit the inside of the post before nestling into the opposite corner, leaving Odunze with no chance.
There was an instant response from the hosts, with Maswanhise winning possession back from Beadle before tucking the ball into an empty net, with the Seagulls 'keeper stranded way outside his box.
Now searching for an equaliser, McAteer's cross was met by Paul Appiah, who had time to steady himself and take aim, but the centre-back was unable to divert his effort on target, dragging it wide.
The South Coast outfit looked to regain their two-goal advantage, and with Ferguson hunting for a hat-trick, it took a smart save from Odunze to keep out the Irishman from close range.
It was soon Cam Peupion's turn to go for goal, but after driving into a shooting position, lifted his strike above the crossbar, while Fitzhugh also had an effort stopped at the other end shortly after.
The away side's third arrived on the stroke of half-time. Jack Hinshelwood laid off Ferguson, who clinically dispatched the ball into the top corner to complete a first-half hat-trick for the young striker.
Though it was City needing to strike, the Seagulls started the second half on the front foot and might have gone further ahead had Ed Turns headed Jack Spong's corner on target.
Luca Barrington then almost made an impact soon after coming on as a substitute, teeing up Spong to strike first-time, though Odunze was equal to it.
The first goal of the second period could have Leicester's way, but Maswanhise was surprisingly reluctant to pull the trigger in the box and Brighton were eventually able to clear.
He was more direct the next time he received possession close to goal, cutting inside on his right, but finding the side netting, in what was one of Leicester's best chances of the half.
Joe Wormleighton also looked to create from deep, working the ball out to substitute Iestyn Hughes, whose cross was met by Kian Pennant, though without a strong enough connection he was unable to test Beadle.
As City pushed forward, it left gaps at the back and Ferguson looked to take advantage. His strike from distance was beaten away by Odunze, who also pushed Spong's free-kick out of harms way. The Brighton man's corner was then diverted over by Turns, but the Seagulls did not have to wait long to add to their tally.
The three points were wrapped up in the 89th minute as Spong took aim from a free-kick positioned on the edge of the box and found the corner before Odunze could move across, leaving Leicester beaten.
Major moment – Brighton's third
Having got back into the game via Tawanda Maswanhise's finish, the third goal, right before half-time, made City's task that little bit more difficult and allowed Brighton to sit back and soak up the pressure in the second half, while still maintaining their own attacking threat.
Who impressed? – Maswanhise nets again
It was a day of few opportunities for City's youngsters but Tawanda Maswanhise still managed to maintain his record of scoring in every game this season. That's six in six games for the forward across all competitions.
Where do we stand? – Eighth position
City drop to eighth in the Premier League 2 Division 1 table, remaining on seven points from their five fixtures.
Coming up – Man Utd away
It's a trip to Leigh Sports Village for City's youngsters on Friday 9 September (7pm BST kick-off) to face Manchester United Under-21s in their next Premier League 2 encounter.
The details...
City: Odunze; Wormleighton; Appiah, Flynn, McAteer; Braybrooke (C), Ewing (Booth 57'); Marcal-Madivadua (K. Pennant 57'), Alves (Hughes 67'), Fitzhugh (T. Pennant 67'); Maswanhise.
Sub not used: Doherty.
Goal: Maswanhise 26'.
All times BST.