Latics suffered the heartbreak of a penalty-shootout defeat as their dream of an appearance at Wembley disappeared.
Chesterfield knocked Latics out of the Johnstone's Paint Trophy for the third successive season as they won through to the Northern Area Final.
Danny Philliskirk (pictured scoring and celebrating) gave Latics the lead only for Tendayi Darikwa to equalise as the match ended 1-1 after 90 minutes to force penalties.
And the shootout also went to sudden death as misses by Philliskirk and Anton Rodgers proved decisive as Latics lost 6-5.
It was cruel way to bow out, something endorsed by Lee Johnson as Latics' manager said: "It was gut wrenching to lose that way after a good game.
"I thought we dominated the game possession in the second half. Our play was decent up to a point and we had a couple of chances we didn't finish.
"However, when it goes into penalties it is a lottery and disappointing we didn’t get a second goal in the 90 minutes.
"We had a couple penalty shouts which I thought were fair ones and I thought the referee (Kevin Wright) made two or three really poor decisions for both sides.
"Sometimes you are fighting against that. We have to keep going and we haven’t looked like breaking down teams well enough which is a worry.
"You have to remember we are still in the early stages with this group and there is a lot more which can be done as far as going forward with us.
"Whether that is to bring somebody in to change the dynamics or to work extra hard on the patterns or the movements remains to be seen, But saying that we could have had three or four on another day."
It was a new-look Latics with six changes made to the starting line up which played Mansfield Town last Saturday.
Genseric Kusunga returned after a three-match ban, James Wesolowski was back after injury while there were recalls for Jonson Clarke-Harris, Michael Petrasso, David Mellor and Paul Rachubka.
James Dayton was ruled out through injury while Mark Oxley, Adam Rooney, Anton Rodgers and Ellis Plummer stood down to the bench and Sidney Schmeltz didn't make the matchday 16.
Latics had a first minute let off when Ollie Banks broke clear and saw his shot flash just wide of the upright.
Petrasso had Latics' first goal attempt shooting into the side netting while Wesolowski's had a shot deflected for a corner.
Latics made the breakthrough in the 20th minute when Philliskirk scored his ninth goal of the season, six of which have come in the JPT.
Mellor played the ball in from the left and Philliskirk produced a delightful turn before shooting low past Tommy Lee.
Chesterfield were back on level terms within eight minutes through Darikwa who not long before had gone close.
Drew Talbot crossed from the right for Darikwa whose downward header looped over Rachubka.
Latics thought they had won a penalty in the 33rd minute when Clarke-Harris went sprawling in the box. Referee Kevin Wright appeared to point to the spot but to the dismay of everybody it was for a goal kick.
Later in the half Petrasso and Clarke-Harris had chances to regain the lead for Latics, but Chesterfield could also have moved ahead as dangerman Darikwa went close and Liam Cooper headed just over.
Mellor set up Philliskirk again early in the second half, but this time keeper Tommy Lee denied him with a super save.
Clarke-Harris was always a threat and twice he had clear-cut chances – one flew wise and the second brought a decent diving save from Lee.
In the latter stages, Latics looked like the only side who would win.
Jonathan Grounds made a weaving run from defence only to be denied by Lee who also pulled off a super save to stop Adam Rooney.
Then in the fifth minute of added time came another shout for a penalty with Latics convinced a cross was handled.
The shootout produced drama as Philliskirk's penalty was saved by the legs of Lee while Rachubka kept out a kick from Ollie Banks.
Rooney, Clarke-Harris and Tarkowski all converted their kicks to make it 4-4 after 10 penalties to send the shootout to sudden death.
Grounds and Darikwa both scored before Lee made a second save to deny Rodgers which afforded the vastly experienced Gary McSheffrey to slot home the winning kick (pictured below).
Latics (4-4-2): Rachubka; Lanzoni, Kusunga, Tarkowski, Grounds; Petrasso (Rooney 81), Smith, Wesolowski (Rodgers 86), Mellor; Philliskirk, Clarke-Harris. Subs (not used): Oxley, Winchester, Plummer.
Chesterfield (4-2-3-1): Lee; Talbot, Cooper (McSheffrey 90+2), Evatt, Humphreys; Hird, Ryan; Darikwa, Banks, Doyle; Richards. Subs (not used): Togwell, Devitt, Chapman, Gnanduillet.
The goals: Philliskirk (20) for Latics. Darikwa (28) for Chesterfield.
Bookings: Wesolowski (72) for Latics. Humphreys (22), Hird (70), Talbot (86) for Chesterfield.
Referee: Mr K Wright.
Attendance: 3,534 (376 visitors).