Led superbly by halfback Tyrone Roberts, Newcastle put in their best performance of the season in belting an understrength Sea Eagles six tries tries to one.
The Knights led 10-0 at halftime and 22-0 midway through the second half before running out comprehensive winners.
Despite being without late withdrawal Steve Matai and Glenn and Brett Stewart, Manly were still expected to win easily.
But some tough goal-line defence in the first half and some scintillating attack in the second half that yielded four tries ensured Newcastle enjoyed just their seventh win of the season.
Try doubles to wingers James McManus and Akuila Uate set up the win, while Dane Gagai and Roberts crossed for the other four-pointers.
Roberts capped a superb night in front of a crowd of 20,154 by booting four goals.
Newcastle opened the scoring after just six minutes when a swift chain of passing down the Knights' right-hand sign opened up room for Uate to score.
Manly had their share of first-half tryscoring opportunities with Anthony Watmough and Daniel Harrison both pulled down just short of the Knights' line.
With just three minutes left on the clock in the opening half, Roberts took on the Manly defence and beat Foran, Matt Ballin and Watmough to crash over for a converted try and a 10-0 lead.
The Knights built on their halftime lead in the 53rd minute with a well worked set play.
A Roberts' long ball allowed left winger McManus to get on the outside of his opposite David Williams to score his first.
And just five minutes later, Newcastle stretched that lead to 22-0 when Gagai pounced on a Jarrod Mullen kick in the Manly in-goal and Roberts again landed the conversion.
Manly got on the board in the 62nd minute when Jamie Lyon stepped his way through from 20m out and passed to Brent Kite who scored.
With Lyon's conversion Newcastle led 22-6 before McManus and Uate crossed for their second tries in the final 10 minutes.