Scunthorpe sub Steve Torpey stepped off the bench to hit a 73rd-minute winner and condemn former club Millwall to a second successive defeat.
Torpey, who started his career as an apprentice at the old Den, had time and space to pick his spot after the home defence were caught square from Marcus Williams' delivery.
It was a bitter blow to swallow, not least because there was a hint of off-side about the goal, and The Lions were desperately unlucky not to have secured at least a share of the spoils in a fiercely fought contest.
Donachie welcomed back Richard Shaw and Neal Ardley to his starting line-up, although the Millwall boss was unable to call on either Zak Whitbread or Ben May, who were both sidelined through injury.
After conceding an early goal at Bristol City last Saturday, the last thing Donachie's men wanted to do was go behind in the opening minutes.
And it was only by virtue of some stoic defending from Shaw that Scunthorpe didn't take advantage after Filipe Morais was caught in possession.
Poul Hubertz, making his first start since 3rd November, fired wide on 15 minutes as The Lions began to ask questions of the visiting defence.
Some neat play between Hackett and Morais saw Hubertz flick on to Ardley, but he dragged wide from 15 yards.
Morais saw his 30th-minute freekick tipped over by teenage debutant keeper Josh Lillis, while Lenny Pidgeley did well to save Billy Sharp's snapshot.
After the break it was Millwall who enjoyed greater possession - unfortunately they just could not turn that into a goal.
Paul Robinson twice headed narrowly over from corners, Hubertz's close-range effort was held by Lillis, who then denied the striker again at full stretch.
The home crowd's cheers on 56 minutes quickly turned to jeers of disbelief when Byfield worked an opening and was just about to shoot when he ended up on the deck following a challenge by Lillis. Referee Andy Hall appeared to have pointed to the penalty spot, only for the official to then brandish a yellow card and book Byfield for allegedly diving.
It proved to be a miserable evening for Byfield, who then clipped an effort wide with only the keeper to beat after Morais slipped the ball through to him after 67 minutes.
Still Millwall continued to press in search of the opening goal with Alan Dunne firing narrowly over from 20 yards.
But the one time the home defence was caught napping, The Lions were ruthlessly punished when Torpey fired home from eight yards.
Donachie responded by bringing on Chris Zebroski for Morais and Ali Fuseini for the tiring Ardley.
But it was Scunthorpe who nearly nicked a second goal when the impressive Andy Keogh's sublime curling effort smacked the inside of the post before the ball was booted clear to safety.
Then, with virtually the last kick of the game, Zebroski had a great chance to grab a dramatic equaliser. However after sprinting into the area the youngster rushed his shot and fired into the side netting.
Now The Lions have to pick themselves up, brush themselves down and get ready to roll up their sleeves for what is a crucial Boxing Day derby at fellow strugglers Brentford.

Millwall: Pidgeley, Dunne, Senda, Elliott, Robinson, Shaw, Morais (Zebroski, 83mins), Ardley (Fuseini, 83mins), Hackett, Byfield, Hubertz. Subs not used: Day, Grant, Lee.
Bookings: Morais (42mins), Byfield (56mins), Hackett (86mins)

Scunthorpe United: Lillis, Byrne, Hinds, Foster, Williams, Taylor, Goodwin, Baraclough (MacKenzie, 76mins), Morris (Torpey, 57mins) Sharp (Ridley, 88mins), Keogh. Subs not used: Butler, Foy.
Booking: Williams (39mins)
Scorer: Torpey (73mins)

Ref: Andy Hall
Att: 7,192 (Away 220)