United substitute Michael Ruhs's 87th-minute goal settled the see-sawing affair at Allianz Stadium, with United mounting a serious second-half challenge after coughing up an early lead on Saturday.
Noah Botic had drawn first blood for the visitors after two and a half minutes before Sydney youngster Adrian Segecic pulled off a first-half maiden brace.
The hosts were again on the back foot when winger Abel Walatee restored parity less than a minute into the second half before Rhys Bozinovski added another in the 62nd.
Sydney peeled one back with captain Rhyan Grant burying home a forceful header six minutes later but Western United had the final say.
Ruhs, joining the fray in the 77th minute, outran Sky Blues defender Alexander Popovic and bested goalkeeper Andrew Redmayne to strike true for the match-winner.
The 22-year-old broke into tears following the final whistle.
This is the moment our substitutes combined to secure a well deserved victory at Allianz 👉🥶— Western United FC (@wufcofficial) Michael Ruhs with an ice cold �#SYDvWUN https://t.co/oeuiPUkMIt pic.twitter.com/D1008rYiizDecember 14, 2024
Holding back from naming players, Talay was blunt in his post-match assessment of their defeat.
"Something that we need to really do is look in the mirror because I believe that some players are underperforming at the moment," Talay said.
"I have a certain expectation of certain players in the team and that's why we picked the team.
"I don't give them the jersey because I think they look pretty in the jersey.
"I give them the jersey because I believe that they're going to win us the game.
"If they're happy to hand the jersey back to me, I can give it to someone else. I have no issues with that."
Jon Aloisi's United side recorded their first win over Sydney since January 2023, while the Sky Blues suffered a second-straight defeat to leave both sides one point out of the top six.
Western United scored three second-half goals to stun Sydney FC in round eight action. (Mark Evans/AAP PHOTOS)
"It was an emotional roller coaster," Aloisi said.
"I said it won't be easy. You're coming away to Sydney FC. It's never going to be easy, but the rewards will be there if you put in the effort and believe that you can get the result.
"I was expecting a high-scoring game. I just was hoping that we were on the right side of it.
"And in the end, we were."
Stunned by Botic's opener, a poor pass from Riku Danzaki opened the door for the hosts to equalise in the 37th minute.
The Japanese defender had intended for the ball to connect with Tate Russell, but mistimed his pass and gave the ball away to Sydney's Joe Lolley.
Lolley pounced and crossed to Segecic, who slotted easily.
Segecic popped up again a minute into first-half added time to complete his brace and launch Sydney ahead, finishing a brilliant cutback from Anas Ouahim.
Adrian Segecic (7) was on target twice for Sydney FC against Western United. (Mark Evans/AAP PHOTOS)
The Sky Blues should have had a larger buffer after taking 12 shots on target to four in the first half, but United goalkeeper Matt Sutton proved a true brick wall.
Sutton put on a show with nine fantastic saves, flaunting his quality by denying Lolley with the studs of his left boot in the 16th minute.
Star Sydney recruit Patryk Klimala scored in the 48th minute but it was ruled out for handball.
United's Hiroshi Ibusuki suffered a similar fate after his 57th-minute goal was rubbed off for offside.