Serbia, who had lost their first match 1-0 to Ghana, beat Germany 1-0 in their Group D match.
The only goal of the game came a minute after German striker Miroslav Klose's red card, following which Milan Jovanovic scored in the 38th minute.
The German team had only themselves to blame, as Lukas Podolski - who squandered several great chances - had a penalty saved shortly before the hour mark.
This is the first German group stage defeat since 1986.
Earlier, Spain lost to Switzerland and the US drew their match with England in a similar series of events.
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