United's recent impressive run and unbeaten start to the season at home was ended by bogey team Reading.
An early goal from Kalifa Cisse and another from Kevin Doyle on the stroke of half-time was enough to give Reading the points and help the Royals extend their lead over the Blades in the Championship table.
James Beattie's effort struck a post and United improved vastly after the break but were unable to get the better of Reading's well-drilled defence.
Blackwell was forced into two changes from the team that won at Barnsley with Ehiogu suspended and Webber picking up an injury. Kilgallon was brought back into the centre of defence and Howard was added to the midfield, allowing Quinn to play an advanced role with Beattie and Stokes.
Before kick-off there was a minute's applause for Cec Coldwell, United's former skipper, coach and acting manager, who passed away last weekend, whilst the home side were again asked to kick towards the Kop in first period.
Morgan was called upon to concede the game's first corner in the second minute when he kept out Doyle, but from Stephen Hunt's delivery Bikey was given space to test Kenny.
It was from another set-piece, on five minutes, that Reading opened the scoring from. Stephen Hunt's quick throw-in found Doyle and his pull-back enabled CISSE to side-foot beyond Kenny's left hand and into the net. The goal was the first United had conceded in the opening 15 minutes of any game this season.
Stokes was booked for simulation when he went over in the penalty as United looked for a quick response, whilst Cisse went close from another Reading corner at the other end.
With Hahnemann stranded, United were unable to redress the balance from a cross by Stokes and United were struggling to find the rhythm of previous weeks.
Just after the half-hour mark Armstrong fired over after Stokes gave away possession and Harper stung the palms of Kenny after being permitted the space to approach the 18-yard box unopposed.
United were second best for most of the first half but twice tested the Reading defence in the space of a minute close to the break. Firstly, Doyle was forced to head clear from inside his own six-yard box and from the resulting corner Stokes and Kilgallon were unable to turn the ball goal-wards despite Hahnemann losing the flight.
Worse was to follow as United conceded a second just a minute before the break. A free-kick on the right, following Sun Jihai's foul on Noel Hunt, saw Stephen Hunt deliver and DOYLE appeared to get ahead of a crowded penalty area to touch past Kenny from close range.
United were unable to get back into the game before the break and Blackwell reacted at half-time by making a double change. Halford and Sharp were thrown into the action at the expense of Quinn and Spring.
United began the second half well, despite Kebe toe-poking wide for Reading. With 48 minutes gone Sharp's cross saw Beattie turn the ball towards goal but Hahnemann was down quickly to claw the ball away.
A Halford shot was blocked, after his own enterprising run, whilst a goal was just inches away around the 50 minute mark. From a Stokes cross, Beattie's effort agonisingly hit a post and Ingimarsson almost found his own net as he attempted to clear.
Stokes curled wide and Howard fired at Hahnemann as United's revival continued past the hour but the visitors stuck to their defensive duties well.
At the other end Morgan was forced to clear as Noel Hunt's delivery looked destined for Doyle but United were soon back on the attack and causing problems, especially when Henderson was added to the mix. Beattie's header from Sun's cross on 80 minutes was just over the crossbar. Ingimarsson then did well to cut out Henderson's flick on which would have put Sharp in the clear.
Sharp's shot was deflected wide on 83 minutes and then, in the final minute of normal time, the same striker could not believe it when his effort hit Hahnemann.
Three minutes of injury-time was announced but United were unable to break the Reading hoodoo which has seen the Blades fail to win against Royals since December 2002.
Blades: Kenny, Morgan, Kilgallon, Stokes (Henderson 79), Beattie, Sun, Speed, Howard, Spring (Sharp 45), Quinn (Halford 45), Naughton.
Unused: Naysmith, Cotterill.
Reading: Hahnemann, Armstrong, Cisse, Doyle, S. Hunt, N. Hunt (Long 76), Kebe (Gunnarsson 68), Harper, Ingimarsson, Rosenior, Bikey.
Unused: Matejovsky, Henry, Andersen.
