Kevin Sandwith's fluke goal earned cash strapped Halifax a £37,000 Christmas bonus by sending them into the LDV Vans Trophy Northern Area semi-finals.
Defender Sandwith fired in an attempted cross on 20 minutes that drifted through a packed penalty area and straight into the net.
It insured Halifax became the first ever Conference side to reach the Northern Area semi-finals and comes as a timely boost to Halifax's coffers.
The first half was so embarassingly one-sided, Lincoln should have been ashamed of themselves. They rarely got out of their own half and should have been buried by an avalanche of goals before the break.
American-born striker Jake Sagere should have put the Shaymen ahead in only the first minute, but he just failed to connect with Adam Yates' right-wing cross, Craig Midgley hit the post straight from a corner and Val Owen wastefully headed over another Midgley corner from close range.
Lincoln keeper Alan Marriott pulled off a terrific save to deny Andy Farrell on 35 minutes after the Halifax striker had latched on to a weak backpass from Paul Mayo.
City's Dene Cropper summed up Lincoln's night when he missed an open goal in first-half injury time, following Peter Gain's byline cross against the run of play.
Lincoln did marginally better after the break, but striker Simon Yeo failed to hit the target when put clean through by substitute Allan Pearce on 67 minutes.
And despite a flurry of late pressure, Halifax clung on to record their second victory over league opposition in this competition and earn a lucrative semi-final trip to Blackpool next month.