Institute's suffered a disappointing Samuel Gelston’s Whiskey Irish Cup exit, as Lough 41 Premier Intermediate side Portstewart left it late to secure victory, at the Ryan McBride Brandywell Stadium.
Mark Edgar's stunning goal six minutes from time sealed the hard fought win for the visitors, as Brian Donaghey's side, not for the first time this season, missed good chances when they were on top, especially in the second half.
However it was their lack of intensity and drive in the first half meant they were unable to get out of second gear all day, which disappointed the Institute gaffer.
The Drumahoe club, who gave debuts to recent signings Ciaran Deery and Caolan McLaughlin, were disappointing in the opening 45 minutes as Johnny Law's men had created the better openings on a bitterly cold afternoon.
The visitors got in behind the Stute back line on six minutes when Edgar broke clear, but the left winger's effort from just inside the box failed to trouble John Connolly and flew over the bar.
Stute's first effort on goal came on 24 minutes but Brendan McLaughlin's long range strike was easily gathered by Portstewart keeper Andrew Finlay.
Just after the half-hour mark Portstewart had a good chance to break the deadlock as Glenn Law's in swinging left wing corner flashed across the Stute six yard box, but James Peden was unable to turn the loose ball home at the back post.
A superb pass by Shaun Doherty on 48 minutes released Tiernan Brown down the left and the youngster's teasing centre into the six yard box found Brendan McLaughlin at the near post, but the striker was unable to divert the ball on target.
Just after the hour mark Finlay was forced to make a stunning save as he got down low to turn away McLaughlin's low drive around his right hand post, after the Stute front man had got in behind the Portstewart defence.
From Rhys McDermott's resulting corner McLaughlin's glancing header was superbly kept out by a diving Finlay and Shaun Leppard's follow-up strike was blocked on the line by John Watt.
On 78 minutes a super pass by Doherty found McLaughlin inside the box, but his spectacular over-head kick attempt, from around the penalty spot, which had Findlay beaten, flashed just over the bar.
The Premier Intermediate side won the cup tie in stunning fashion on 84 minutes as Edgar's superb dipping drive from 30 yards, flew over Connolly into the net.
Institute: John Connolly, Rhys McDermott, Shaun Leppard, Ciaran Deery (Joshua Busteed 58), Conor Quigley; Patrick McLaughlin, Shaun Doherty, Mark McFadden; Tiernan Brown, Caolan McLaughlin, Brendan McLaughlin.
Portstewart: Andrew Findlay, Chandler Douglas (Nicky Hudson 79), John Watt, Glenn Law, Zach Barr (Sam Boylan 79), Ryan Doherty, Mark Edgar, Jason-lee Moorcroft (Lee Forgrave 74), Karl Steele, James Peden, Eoin Gillan.
Referee: Neil Robinson.