Milan are in fifth place, level on 66 points with Napoli and Juventus and two points behind Atalanta, while Lazio are five points behind with a game in hand
Lazio revived their hopes of Champions League qualification and subjected AC Milan to a second consecutive Serie A defeat as Joaquin Correa scored twice in a 3-0 win for the Roman club at the Stadio Olimpico on Monday.
Milan are in fifth place, level on 66 points with Napoli and Juventus and two points behind Atalanta, while Lazio are five points behind with a game in hand.
The Argentine international struck the opener after 77 seconds before beating his marker to fire home a superb second after the break.
Ciro Immobile fired in a third for Lazio late on, as the sixth-placed side earned a 10th consecutive home win that takes them up to 61 points.
"Now we need to show that we are strong, like I believe we are," Milan coach Stefano Pioli told Sky Italia.
"We must react straight away, because this is a heavy defeat."
The stakes were high for both teams ahead of kickoff, with Lazio needing a win to keep their top four hopes alive and Milan looking to avoid another setback after losing 2-1 to Sassuolo last week.
Correa put Lazio in front after 77 seconds when he exchanged passes with Immobile before calmly rounding the goalkeeper to tap in.
Manuel Lazzari fired home Lazio's second on the brink of halftime, but the goal was disallowed by VAR as the wing-back was narrowly offside.
The hosts doubled their lead six minutes into the second half when Correa dribbled past Fikayo Tomori and shot into the roof of the net.
Referee Daniele Orsato consulted VAR for a potential foul in the build-up, but allowed the goal to stand.
Correa was close to a hat-trick when his fierce angled drive was tipped wide by the diving Gianluigi Donnarumma, and Immobile was inches away from a goal when his lob came back off the post.
The Italy striker eventually found the net when he fired into the corner with three minutes remaining, but Franck Kessie almost grabbed a Milan consolation when his glancing header came back off the bar.