Philippe Coutinho was the star of the show with two goals and an assist as Liverpool edged Arsenal 4-3 in a thriller at the Emirates.
Nathaniel Clyne had the first chance of the game, but fired straight at Petr Cech from the angle of the box.
Arsenal should have been in front just before the half hour when Alberto Moreno gave away a penalty after bringing down Walcott in the area, but the former Southampton winger saw his poor spot kick easily beaten away by Simon Mignolet.
But Walcott made amends seconds later when he was picked out in space by Alex Iwobi, with Moreno woefully out of position, and finished expertly into the opposite corner of Mignolet's goal.
Liverpool equalised in first-half stoppage time through a superb Coutinho free kick. The midfielder was adjudged to have been pulled down by debutant Rob Holding 35 yards out, and Coutinho delivered a powerful set-piece effort into the top left corner of Cech's goal.
The game was turned on its head just four minutes after the restart. This time Coutinho turned provider, finding space down the left channel to cut back inside and pick out Adam Lallana with a chipped pass. The England international chested the ball into his path before finishing low under Cech.
It got worse for the Gunners in the 56th minute as Coutinho's masterclass continued. Clyne got past Nacho Monreal down the right and drilled across to the edge of the six-yard box, and there was the Brazilian with a clinical first-time finish beyond Cech.
It was almost four before the hour ticked by when Coutinho's snap shot was expertly kept out by Cech.
By the 63rd minute it was four, however, with debutant Sadio Mane bursting past Calum Chambers and Monreal before blasting brilliantly into the top corner.
Just when Liverpool thought they could relax, Arsenal went up the other end and pulled one back. Substitute Alex Oxlade-Chamberlain cut into the box and saw his effort deflect off Georginio Wijnaldum, and that just took the ball beyond Mignolet.
There was concern for Liverpool in the 70th minute when Coutinho went down after appearing to suffer an injury.
The game was well and truly on when Arsenal scored a third in the 75th minute, Chambers glancing home Santi Cazorla's free kick from out wide.
But Arsenal struggled to create anything of note to worry the Liverpool rearguard, and they held on for a famous win.
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