Gary McSheffrey gave the Iron the lead before two quick goals turned the game on its head.
Liam Kelly and Dominic Poleon fired Latics ahead before Tommy Rowe equalised going into half time.
However, goals from Paddy Madden and Kevin van Veen won the game for Scunthorpe United as Latics fall to their first defeat in four games.
Dunn named himself on the bench for the first time since taking over as manager of the football club and he also made one enforced change with Jay Fulton replaced by Lee Croft.
Latics started the game well but it was the visitors that took the lead on 10 minutes through McSheffrey.
Connor Brown’s loose ball was picked up by Paddy Madden who drove at the defence and fed the former Coventry City man to put the Iron ahead.
The home side were shocked and three minutes later they could have extended their lead but goalkeeper David Cornell pulled off a great save to deny Tom Hopper at the back post who headed goalwards.
The game started to become fiery with both captains called over by the referees to calm their players down.
Athletic drew level midway through the first half through captain Kelly.
Poleon won the ball in the box, fed the ball back to Philliskirk to strike but the ball deflected into the path of Kelly to convert from six yards to bring Latics level.
Two minutes later and Dunn’s men had turned the game on its head as Poleon fired Latics into the lead.
Daniel Lafferty’s free kick was cleared but the ball was fired back in and the hot-shot striker made no mistake from five yards to put his side into the lead.
Ten minutes before the half time break, Cornell was again forced into action as he tipped wide a long range McSheffrey.
However, a minute later, Scunthorpe found their leveller in fortunate circumstances.
Rowe took the ball beyond Jonathan Burn and shot. With the ball destined for the arms of Cornell, Lafferty just managed to touch the ball and it squeezed past the goalkeeper and equalised.
Both sides had chances to score before the break as Bishop’s header was saved by Cornell whilst at the other end, Poleon saw a shot deflected for a corner whilst the referee blew the half time whistle to signal the end of a pulsating first half.
That intensity going into the second half was slightly lost with both sides keeping possession.
Lee Croft was replaced on 55 minutes by Mark Yeates whilst the referee continued to make himself unpopular with the home fans.
Just after the hour mark, Jones’ shot was saved by Scunthorpe goalkeeper Luke Daniels with Latics continuing to attack his goal.
Scunthorpe took the lead on 69 minutes through striker Madden.
Neal Bishop beat the offside trap on the right, crossed into the centre for Hopper but Cornell expertly saved. However, the ball fell perfectly to Madden 12 yards out and he blasted into the goal to put Scunthorpe ahead.
Latics needed a response and Dunn brought himself into the action to try and get something out of the game.
Kelly and Dunn both had chances from outside the box but both did not test the goalkeeper.
Scunthorpe extended their lead and won the game on 84 minutes after a tremendous solo goal from van Veen.
The substitute striker took the ball past two players, nutmegged another and chipped the ball over Cornell to make it 4-2 to the visitors.
Latics unfortunately could not get back into the game and Dunn suffered his first defeat as manager of the football club.
Oldham Athletic: Cornell, Brown, Wilson, Burn, Lafferty, Kelly, Jones (Winchester 88’), Croft (Yeates 55’), Philliskirk (Dunn 75’), Higdon, Poleon.
Subs not used: Coleman, Dieng, B.Wilson, Eckersley.
Scunthorpe United: Daniels, Wiseman, Mirfin, Wallace, Laird, King, Bishop, Rowe, McSheffrey (McAllister 71’), Hopper (van Veen 77’), Madden.
Subs not used: Anyon, Clarke, Goode, Lolley, Henderson.
Goals: Oldham Athletic (Kelly 25’, Poleon 27’) 2-4 Scunthorpe United (McSheffrey 10’, Rowe 35’, Madden 69’, van Veen 84’)
Attendance: 4,002 (349 visiting supporters)