India, when rain forced an early lunch, on the fourth day, had collapsed to 35 for three in their second innings - a still sizeable lead of 354 - after fast bowler Anderson had taken two for 17 in seven overs and fellow quick Chris Tremlett one for 17 in 6.2 overs.
Anderson's tally included the prize wicket of Sachin Tendulkar, bowled for one in what could be his last Test innings in England.
India captain Rahul Dravid was two not out and Sourav Ganguly 21 not out.
Dravid, despite seeing England bowled out for 345 chose not to enforce the follow-on even though the home side were 120 runs short of the avoidance total of 465 and 319 behind overall.
It had seemed as if the only realistic way England could win this match and preserve their six-year unbeaten run in home Test series was to set India a challenging total batting last on a wearing pitch.
But instead they reduced India to 11 for three inside seven overs with Anderson taking two wickets for no runs in four maiden overs.
His first wicket was controversial with Wasim Jaffer given out lbw for nought by South African umpire Ian Howell, standing in only his ninth Test in six years, even though the ball appeared to be going over the top of the stumps and missing leg.
Then 10 for one became 10 for two when Dinesh Karthik, who made 91 in the first innings, squared up by a good length delivery from the 6ft 7in Tremlett, and was caught at second slip by Paul Collingwood.
Tendulkar, who'd walked out to widespread applause, was soon walking back in to a further ovation, after being bowled by Anderson when his inside-edged drive saw his middle and leg stumps knocked out of the ground.
India were now 11 for three in the seventh over and England, outplayed for the first three days, had a foothold in the game.
England's performance had been all the more creditable as they were a bowler light with left-arm quick Ryan Sidebottom off the field with a side injury he'd sustained earlier in the match after failing a fitness test on Sunday morning.
But left-hander Ganguly counter-attacked with four boundaries before the rain fell.
England resumed Sunday on 326 for nine, 338 runs behind India's record 664.
Anil Kumble, whose 110 not out, his maiden Test hundred and the first by an India batsman this series, had been the centrepiece of his country's highest Test innings score against England, ended a last-wicket partnership worth 40.
The 36-year-old, in his 118th match at this level, moved into sole possession of third place in the list of Test cricket's most successful bowlers, ahead of retired Australia quick Glenn McGrath, with his 564th wicket when he had Panesar lbw for nine. Tremlett was a Test-best 25 not out.
India, 1-0 up, have won just two Test series in England, 1-0 in 1971 and 2-0 in 1986, in 15 tours dating back to 1932.
England needed to win this match to preserve a six-year unbeaten record in home Test series, a run encompassing eight wins and three draws in 11 campaigns following their 2001 Ashes defeat.