With a game in hand still to come the Gers could extend their lead to thirteen points with just eleven games remaining for their title rivals.
The winner could not have come in more dramatic fashion with three minutes of injury time on the clock when Edu got the final touch in a goalmouth scramble.
The celebrations from the Rangers dugout said it all with Walter Smith and Ally McCoist jubilant in front of the home support.
It was little more than the Light Blues deserved, having knocked on the door for the majority of the second half to get the goal that seemed like it might never come.
Edu was only on the pitch as a result of an early injury to Lee McCulloch, but this will be a match that lives long in the memory for the US international, who started the match on the bench.
Despite suggestions in the run up to the match that Allan McGregor would miss out, he was passed fit and retained his spot between the sticks, with a first choice defence of Steven Whittaker, Madjid Bougherra, Davie Weir and Sasa Papac in front of him.
Whittaker’s inclusion at the back meant Kyle Lafferty took one of four midfield spots, lining up on the left.
Steven Davis took the right sided berth with Lee McCulloch and Kevin Thomson between those two.
And that left Scotland’s top strike pairing up front with 37-goal partnership Kris Boyd and Kenny Miller starting against an inexperienced Celtic backline.
It was a pulsating opening period with bookings and a good chance for Boyd in the opening ten minutes.
There were barely three on the clock when Davis burst from midfield with a trademark driving run and threaded the ball to the Gers No.9.
Boyd nicked the ball round the advancing Artur Boruc but his left foot shot from a tight angle caught the side netting just on the wrong side of the post.
Minutes later Bougherra’s name was the first to go in the referee’s book when he collected a yellow card for a challenge on Robbie Keane.
Celtic forward Marc-Antoine Fortune joined Bougherra in the 8th minute when he was cautioned for a deliberate handball.
That action packed opening set the tone for the first half with chances at both ends, two substitutions and a disallowed goal.
Edu had only been on the pitch for a minute, having replaced McCulloch when the midfielder took a knock to the foot, when he had the ball in the net.
The American midfielder drove a fabulous effort low past Boruc only to see the 27th minute strike ruled out with ref Dougie McDonald having already blown for a foul against the Light Blues.
That incident came after two set pieces that offered chances at either end, with Thomson’s delivery just out of Lafferty’s reach at the far post in the 11th minute.
Between those two, Keane floated a free kick from a dangerous area just over McGregor’s goal.
The Gers again almost made the breakthrough just moments after Edu’s effort was chalked off with Miller latching on to a long ball by Boyd, only to see his effort thwarted by Boruc.
If the Celtic keeper’s save was important, McGregor’s at the opposite end was crucial too when he got down well to block a well struck volley from Keane after Bougherra’s tackle on Kamara threw the ball in to the Irishman’s path.
Two of the better opportunities came late in the half with Davis swinging in a great cross that Lafferty might have done more with if his aerial challenge had been stronger.
Gers were almost punished within a minute at the other end when Fortune showed good footwork to get past both Weir and Bougherra.
However the visiting forward dragged his shot well wide of McGregor’s upright when a shot on target would surely have troubled the Gers keeper.
It was Rangers though who started the second half the brighter of the two teams with Davis and Boyd both looking dangerous in the early stages.
The Ulsterman was on the end of a sweeping cross deep in the Celtic box but his volleyed effort was a little too high and Boyd was beaten to the second ball by Josh Thompson.
The Gers forward then had a shout for a penalty with the half just five minutes old when he collected a neat pass from Whittaker in the six yard area.
Before he could get his shot away his feet were taken from under him, although his muted claims suggest he wasn’t expecting the spot kick.
Next up it was Davis who again surged from midfield and with no challenge forthcoming he opted to shoot and when Boruc blocked that initial effort there was a scramble in the Celtic box as Boyd and Miller aimed to capitalise.
It was all Rangers, but Celtic showed their threat on the counter and Rangers had Bougherra to thank as he rescued a four on two situation.
With Celtic swarming forward the Algerian produced a wonderful tackle on the edge of the area to regain possession.
Ranger were then given the upper hand when Celtic captain Scott Brown was ordered off after tangling with Lafferty.
From that stage it was Walter Smith’s men who dominated and they made the breakthrough in the 93rd minute with Edu’s late, late strike placing Smith’s team firmly in the driving seat for a second successive title.