Kolkata Knight Riders banked on Manvinder Bisla (38) and Brendon McCullum's (40) knock as others failed to stay at the crease which saw KKR posting a mere 137/6 in 20 overs.
Gautam Gambhir (5), Kallis (0), Manoj Tiwary (0), Shakib al Hasan (15) disappointed as KKR registered its second defeat in the Group stage of the Champions League and are on the verge of crashing out of the tournament.
Mahmood claimed three wickets for 16 in his 4 overs, which ultimately changed the fate of the match, as Brendon McCullum who was on song, having scored 40 off 35 balls, was dismissed by former Pakistan spinner in the 15th over.
While he had claimed Manoj Tiwary and Jacques Kallis in the 10th over, McCullum's wicket was the icing on the cake.
Chasing 138 to win, Auckland got off to a flying start as they had scored 37 runs at the end of 3 overs, before losing Lou Vincent (30).
After the fall of Vincent, Guptill and Mahmood took over, as the latter made a brilliant half century off just 42 balls which included 3 boundaries and 2 sixes, while Guptill made 25.
Later Mahmood added 41 runs with Kitchen for the 3rd wicket to ensure that Auckland Aces reached the target with 14 balls to spare.
Now, Auckland Aces meet Titans on Wedensday, Delhi Daredevils on Friday and Perth Scorchers on Oct 23 (Tuesday), while KKR have a tough task at hand, as they face themselves in a must-win situation after losing back-to-back ties.