Fahey, one of the younger members of this experienced Blues side, scored the crucial opening goal two minutes before half-time to knock the wind out of Southampton's sails.
The defeat keeps the Saints firmly entrenched in the bottom three despite the recent improvement under new manager Mark Wotte.
It was a welcome double for Blues, who have now won their last two games 1-0 to lift the spirits of the fans who were becoming disillusioned following a poor run of results.
Blues, however, remain in second place behind Midlands rivals Wolves, but poised to make a determined bid to retain their Premier League status at the first attempt.
For only the second time this season Blues fielded an unchanged side following their win over Bristol City and the new found spirit was evident as they chalked up another victory over a far from out-classed Southampton.
But boosted by their impressive midweek win at Ipswich, the Saints were quickly into their stride with Marek Saganowski firing just wide.
It certainly appeared to lift Southampton as they steadfastly refused to be pegged back by an eager Blues side.
Blues did, however, suffer an early set-back when Marcus Bent limped off in the 16th minute with a hamstring injury - the latest in a long line of injuries suffered by the Blues front-men.
Bent is now the third striker to be sidelined in the absence of Garry O'Connor and Kevin Phillips - the goalscorers in the 2-1 win over Southampton last August.
Bent's enforced departure did not put Blues out of their stride as they strived for a crucial goal.
Fahey was denied by Kelvin Davis at the far post, while a long range free-kick from Seb Larsson just dipped over the bar.
Southampton were dangerous on the break but their leading marksman David McGoldrick could make little impact against either Radhi Jaidi or Martin Taylor.
The stalemate was broken two minutes before half-time. Following several raids down the right flank, Cameron Jerome cut in and rolled a pass to Lee Bowyer who allowed the pass to go through to Fahey, who hammered in a powerful shot past Davis.
Southampton strived to get back onto level terms and Blues' experienced defence had to dig deep to keep out the Saints with Morgan Schneiderlin a big driving force.
Only the woodwork saved Southampton from conceding a second goal. Clever work by Carlos Costly ended with the Honduras international slamming his shot against the post.
Three minutes before the end another of Blues' substitute's, Scott Sinclair, hit the angle of the post following a 20-yard run through Southampton's defence.