Reading started the game the brighter of the two teams and had a couple of early chances and a claim for a penalty when Stephen Hunt appeared to be clipped by Pepe Reina but it was waved away by the referee.
Liverpool opened the scoring against the run of play on 15 minutes. After a breakaway from a Reading free-kick, Arbeloa exchanged passes with Peter Crouch before bending a shot past Marcus Hahnemann for his first Liverpool goal.
The goal settled the Red down and they took control for the rest of the half without really threating to add a second.
It was a different story in the second half as Reading equalised straight after the break when Brynjar Gunnarsson found space at the far post and buried home, although there was a suspicion of offside about the goal.
Liverpool went up the other end and had a penalty claim of their own as Craig Bellamy was brought down in the box. Once again the referee waved play on.
It was end to end stuff for the rest of the half, in what probably would have been a good game for the neutral. Peter Crouch almost scored a cracking header at the wrong end but was saved by the crossbar before subsitutes Jermaine Pennant and Dirk kuyt combined five minutes from the end to create a winner for the Reds.
Pennant found space on the right and cleverly cut inside before lobbing the ball into the six yard box for Kuyt to outjump everyone and score his tenth league goal of the season.
With Arsenal losing at home to West Ham this win sent the Reds five points clear of the Gunners in the race for third place.