Jason Scotland's fourth goal of the season wasn't enough to salvage a point for Blues.
The Trinidad international volleyed in from close range two minutes after Lukas Jutkiewicz had converted from the penalty spot following Clive Platt's first-half opener.
Scotland was denied an equaliser by the right hand of Keiren Westwood, the Sky Blues' 'keeper also holding firm from Jake Livermore's 20 yard drive.
The game ended with Marton Fulop in the opposition box for a corner but to no avail as Blues went down to a second home defeat of the season.
Town made one change to the side that beat Leeds, Luke Hyam coming into midfield with Jamie Peters taking up the right-back position. Tom Eastman dropping to the bench.
Jutkiewicz fired a left footer over in the only effort at goal in a slow start to the game, with Town restricted to long throws and corners into the box that proved no problem for the dominating Sky Blues 'keeper Westwood.
Andros Townsend had a free-kick blocked by the wall after trickery from Grant Leadbitter had drawn a foul from Ben Turner.
Leadbitter had a shot deflected wide before Coventry got the breakthrough on 19 minutes. They had threatened from set-pieces, Fulop struggling to clear his lines under challenge from Platt and it was the former Colchester striker who put the visitors in front, heading in from close range after Aron
Gunnarsson had headed Sammy Clingan's corner across goal.
Town had a half shout from a penalty when Scotland went down under Richard Wood's challenge but referee Rob Shoebridge was rightly not interested.
Jake Livermore had the crowd on their feet with a curler that went inches wide before Richard Keogh's picked up the first yellow card of the game for a foul on Townsend.
It took a great tackle from McAuley to deny Jutkiewicz from getting in on goal while at the other end Westwood was quick off his line to beat Scotland to the ball.
Town were fortunate to remain just one down when Jutkiewicz shrugged off McAuley and smashed a shot past Fulop and against the underside of the bar, the ball appearing to bounce down on the line.
Sammy Clingan sent a free-kick at Fulop, Scotland hooked over, then had a shot deflected wide in the last effort of the half.
Town boss Roy Keane made a change at the break with Connor Wickham on for Hyam and Blues pressed Coventry back in the opening 10 minutes, with Scotland seeing Westwood keep out a right foot effort, then Livermore had a strike straight at the Sky Blues' 'keeper from 20 yards.
It was the visitors who struck again though on 56 minutes, McAuley adjudged to have brought down Jutkiewicz and the striker did the rest from the spot.
Town responded within two minutes, clever play between Livermore and Peters and Scotland was on hand to volley in from eight yards for his fourth goal of the season.
Blues made a double change on 73 minutes with Tamas Priskin and David Norris on for Peters and Townsend.
Norris was immediately in the action, having a shot blocked by Wood but Blues were fortunate at the other end, Clingan's free-kick headed against the post by Platt.
Coventry made their first change on 81 minutes with Carl Baker replacing Gunnarson but it took an excellent save from Westwood seconds later to keep out Scotland's left foot rocket.
Sky Blues made a second change with Michael Doyle replacing Gary McSheffrey for the closing five minutes.
Fulop came up for a corner as the game entered added on time and the Hungary international threw himself at Leadbitter's corner but the ball was cleared and with it went the points as Coventry ended a run of four straight defeats at Portman Road,
Town: Fulop, Peters ( Norris 73), McAuley, Smith, Kennedy, Edwards, Hyam (Wickham 46), Leadbitter, Livermore, Townsend (Priskin 73), Scotland. Subs not used: Murphy, Delaney, Brown, Eastman.
Coventry: Westwood, Keogh, Wood, Turner, Cranie, Gunnarsson (Baker 81), Clingan, Carsley, McSheffrey (Doyle 86), Jutkiewicz, Platt. Subs not used: Ireland, McIndoe, Clarke, O'Donovan, Cameron. Booked: Keogh.