The hosts pulled one back through Freddie Sears to set up a tense finish but Scunthorpe held firm for the win.
A superb long range goal from Jimmy Ryan late in the first half, followed by Karl Hawley's strike straight after half-time put the away side two goals up.
The Iron recorded a massive three points at Colchester United, as they jumped out of the relegation zone for the first time since October 2 - leapfrogging opponents Colchester United in the process.
Manager Brian Laws made four changes to the team which drew 0-0 with Shrewsbury last week. Illness forced Mark Duffy missed out through illness, while hamstring injuries meant that neither Christian Ribeiro or Damien Mozika were available for selection and Nathan Ellington returned to parent club Ipswich Town after the Iron decided not to renew his loan.
That meant that a reshuffled Iron lined up with Sam Slocombe between the posts, and a back four from right to left of Tom Newey, skipper Paul Reid, Niall Canavan and Callum Kennedy.
Moving back from his usual striking position to the right of a midfield quartet was Karl Hawley. He was joined by a central pairing of Michael Collins and Ryan while Andy Barcham stepped up from the bench to start on the left; up top Mike Grella started alongside new signing Akpo Sodje.
Within a minute, the visitors were almost behind after losing possession in the centre. Gavin Massey then broke down the U's right before whipping in a cross which Dominic Samuel fired just the wrong side of the post.
Then after seven minutes it was the turn of Drey Wright to flash one past Slocombe's other post as the hosts made all of the early running much to Laws behest as he incessantly barked out encouragement from his technical area.
After twelve minutes the visitors forced a flurry of corners and it was from the last of those, albeit after a goal mouth scramble that Ryan forced a save from Mark Cousins.
As the half wore on, it was the visitors who looked the more likely to screw as on the half hour mark they forged a succession of chances as they began to commit more and more men to the attacks after weathering the early storm.
First a mazy Grella run forced a last ditch challenge; then strike partner Sodje scuffed a shot straight at Cousins before a Barcham thunderbolt forced the U's keeper into a far more spectacular save with much of the game being played in the home side's half.
On their increasingly rare forays forward it was debutant Billy Clifford, signed on loan from Chelsea in the week, who looked the most dangerous.
Then on 40 minutes the Iron did take the lead, with an absolute cracker.
A Collins free kick inside the centre circle was lofted into the 18 yard box where Reid managed to win the knock down; the ball then fell to Ryan fully 35 yards out who simply placed the ball into the top left corner of the net to give the Iron a half time advantage few would argue they didn't deserve.
That prompted home manager Joe Dunn into a double substitution with strikers Clinton Morrison and former Iron loanee Freddie Sears replacing Samuel and Marcus Bean.
However, 28 seconds later his task became doubly hard as the Iron made it two.
A ball down the middle was flicked on by Sodje, into the patch of Hawley who deftly bent a drive with the outside of his boot into the back of the net.
Moments later Kennedy smashed a free kick against the left hand upright as the home side looked in danger of complete collapse.
But on the hour mark, Laws' men were ruing their missed opportunities as Freddie Sears pulled one back leaving the 201 hardy supporters who made the journey from North Lincolnshire wondering if a repeat of New Year's Day was on the cards, where the Iron had let a two goal lead slip against Oldham.
That seemed to lift the home side and with just over 20 minutes left, Dunne played his final card, throwing on George Porter in place of Drey Wright whose impact had seemed to wain the more the game wore on.
Then, with 12 minutes remaining Massey had the chance to level, blasting a shot into the arms of Slocombe as the home side increasingly targeted the Iron's full backs with balls over the top.
With Sodje understandably tiring having played so little football of late, he was replaced by Godden to inject fresh legs for the final ten minutes meaning Barcham dropped deeper into a three man central midfield as Laws men looked to hang onto what they had.
Into added time, Colchester threw more and more men forward into the attack as they looked to avert a club record ninth straight defeat but to no avail as the visitors stood firm.
Colchester United: Cousins; Wilson, Thompson, Okuonghae, Rose; Massey, Gilbey, Bean (Morrison 46), Wright (Porter 69); Clifford; Samuel (Sears 46).
Substitutes not used: Heath, White, Sanderson, Pentney.
Scunthorpe United: Slocombe; Newey, Reid, Canavan, Kennedy; Hawley, Ryan (Mirfin 90), Collins, Barcham; Grella, Sodje (Godden 81).
Substitutes not used: Severn, Gibbons, Walker, Adelakun, Howe.
Attendance: 3,258 (201 away).