The Bombers, who had last been in the top eight at the end of round four, set up their 16.7 (103) to 5.9 (39) win with a run of eight unanswered goals from the start of the second quarter to midway through the third term.
The big margin saw the Bombers climb from 10th on the ladder to seventh, leapfrogging Collingwood, who slipped from sixth to eighth, on percentage.
Vote for your top three players from Collingwood's 64-point loss in the Magpie Army Player of the Year Award.
Jake Carlisle starred for the Bombers at both ends of the ground, forming a dangerous tall duo in attack with Joe Daniher and working back deep into defence to help cut off Collingwood spearhead Travis Cloke's supply.
Carlisle finished with a career-best four goals and ruled the air with an incredible 19 marks – including eight contested – in a clear best-on-ground performance.
The Bombers' victory sends Gold Coast tumbling out of the eight and, with skipper Gary Ablett (left shoulder) sidelined for the rest of the season, the Suns' tilt at an historic first finals series is now in serious peril.
The Magpies' finals hopes look healthier, but it was just five weeks ago that they were sitting fourth on the ladder and aiming for the double chance.
Those hopes seemed dashed now, with the Pies set to slip three games outside the top-four if, as expected, Fremantle beats Greater Western Sydney at Patersons Stadium on Sunday evening.
The Pies really only challenged Essendon in the first term, when they won the inside 50 count (14-10) and had more scoring shots (6-4) but butchered several chances in front of goal to go into quarter-time eight points down.
From there the Bombers did as they pleased, breaking the Pies' defensive lines with their run through the midfield and making them pay up forward, both in the air through Carlisle and Daniher and at ground level through Paul Chapman, Patrick Ambrose (three goals each) and Zach Merrett (two goals).
Essendon's defensive pressure was also outstanding, with the Dons often forcing the Pies to kick long inside their forward 50, making life tough for Cloke.
Brent Stanton (32 possessions and one goal) and Dyson Heppell (29 possessions) were outstanding in an Essendon midfield missing Jobe Watson and Brendon Goddard, while Cale Hooker kept Cloke goalless and Jason Winderlich was creative across half-back.
Essendon coach Mark Thompson said he challenged his players to step up and cover for the absence of key players Watson, Goddard and Hibberd.
"That was the challenge - to step up, and they did," Thompson said.
"We looked like we were in control of the game. I think it's the first time I've seen this group do that for four quarters on such a big stage.
"I said to (Chairman) Paul Little before the game that I thought they'd been in a good frame of mind and I thought we'd be OK."
Collingwood coach Nathan Buckley said the Pies' loss was their most disappointing since their 70-point defeat by Fremantle in round one this year.
"We weren't strong in the contest, in transition we couldn't get enough blokes behind the ball to defend when they went forward, we couldn't get enough blokes in front of the ball when we had it," Buckley said.
"So we were outworked, outhustled through the contest and particularly disappointed with our inability to match contested ball."
Steele Sidebottom was the Pies' best player (28 possessions), while Dayne Beams (23 possessions and two goals) and Scott Pendlebury (23 possessions) battled hard through the midfield, while Jack Frost was manful in defence against an avalanche of Bomber attacks.
Collingwood 2.4 2.6 4.9 5.9 (39)
Essendon 4.0 8.1 14.1 16.7 (103)
Goals - Collingwood: Beams 2, Young, Lumumba, Seedsman
Essendon: Carlisle 4, Ambrose 3, Chapman 3, Z.Merrett 2, Daniher, Hocking, Zaharakis, Stanton
Best - Collingwood: Sidebottom, Beams, Pendlebury, Williams
Essendon: Carlisle, Chapman, Stanton, Heppell, Z Merrett, Ambrose, Hooker
Injuries - Collingwood: Maxwell (left ankle)
Essendon: Nil
Substitutes - Collingwood: Ben Kennedy replaced Clinton Young in the third quarter
Essendon: Cory Dell'Olio replaced Jason Winderlich at three-quarter time
Reports: Nil
Umpires: Donlon, Margetts, Schmidt
Official crowd: 58,992 at the MCG
