Roland Sallai found the net in both halves to propel the visitors to their first away win against England since a famous 6-3 win at Wembley in 1953. England's misery was compounded in the final 10 minutes as Zsolt Nagy and Daniel Gazdag scored further goals and John Stones was shown a second yellow card to make it one of the worst nights of Gareth Southgate's reign.
England remain winless and at the bottom of their Nations League group with two points from four games, including a 1-0 defeat to Hungary in the reverse fixture earlier this month. Hungary top the group on seven points, ahead of Germany and Italy. The group winners go to the Nations League finals next June while the bottom team are relegated.
Southgate made nine changes from the team that drew with Italy at the weekend to give some fringe players a chance. But despite dominating possession, England created few chances, and the experiment backfired leading to loud boos from the home support.
"It's not pleasant," Southgate said. "The irony is that the pressure we've had and the reputational comments have come in the two Nations League campaigns, and in neither campaign have we been anywhere near able to pick our strongest teams for the games. The matches where every other England manager has been judged, we've had the best performances for 50 years.
"So there is a balance in my head. I'm really clear. But I totally understand the response tonight. I totally understand there's been this narrative all week. I didn't think that was correct after the Germany game. But tonight, I can't dress up what's happened tonight in any way, shape or form. But if we're judged on the matches with our full strength players, then I think it's a different assessment.
"So I've got to accept the next period is going to be unpleasant and uncomfortable. But that's life as a football manager, you're never going to have six years like we've had and not have bad nights.
"I know great people like Sir Bobby Robson, what he had to go through and how he was viewed in the end on getting the team to a World Cup semifinal. Football is emotional. People pay to come and watch. They're going to give an opinion. The team weren't able to deliver tonight, my responsibility. And so if the flak comes my way then I have to deal with that. It's not realistic to have had the ride I've had for five years and not have bad nights, difficult night."
Sallai began the rout when he controlled the ball on his knee after a miscued header from Stones before drilling past Aaron Ramsdale in the 16th minute.
Sallai scored a second in the 70th minute with a perfect finish with the outside of his boot after Kalvin Phillips lost a tackle. Nagy chipped Ramsdale, and Gazdag drove from distance into the corner for two late goals that heaped pain on England.
England captain Harry Kane, who provided some of England's few moments of quality and hit the bar with a header, acknowledged his side's second-half capitulation was "unacceptable," but urged fans to be forgiving.
"It's our first big defeat in a long time. It's not time to panic, it's time to keep our heads up," he said.
"We have to take it on the chin and move forward, prepare for the World Cup, we'll learn a lot. ... Let's not forget where we've come from. It's not going to be perfect every game."
After reaching the semifinals of the last World Cup in Russia then narrowly losing last year's Euros to Italy, England have high hopes for the Qatar World Cup at the end of this year. But their dismal form in the Nations League has baffled fans and saw boos ringing out as they traipsed off the Molineux pitch.
It was the first time England had lost a home match by four or more goals since March 1928 when Scotland beat them 5-1.
Information from Reuters was used in this report.