Businessman Clifford Coombs took over as Birmingham chairman in 1965, and appointed Stan Cullis as manager. Cullis's attractive football took them to cup semi-finals, but league football needed a different approach. Successor Freddie Goodwin produced a team playing skilful, aggressive football that won promotion to the First Division as well as reaching an FA Cup semi-final. Two years later, the club raised money by selling Bob Latchford to Everton for a British record fee of £350,000, but without his goals the team struggled. In 1979, with relegation a certainty, the club sold Trevor Francis to Nottingham Forest, making him the first British player transferred for a fee of £1 million; Francis had scored 133 goals in 329 appearances over his nine years at Birmingham. Jim Smith took Birmingham back to the top tier, but a poor start to the 1981–82 season saw him replaced by Ron Saunders of league champions Aston Villa. The team still lacked goals, and were relegated in 1984. The last home game of the 1984–85 promotion season was marred by rioting and the death of a boy when a wall collapsed; the events formed part of the remit of the Popplewell inquiry into safety at sports grounds. Saunders quit after FA Cup defeat to non-League team Altrincham, staff were laid off, the training ground was sold, and by 1989 Birmingham were in the Third Division for the first time in their history.
In April 1989 the Kumar brothers, owners of a clothing chain, bought 84% of the club. A rapid turnover of managers, the absence of promised investment, and a threatened mass refusal of players to renew contracts was relieved only by a victorious trip to Wembley in the Associate Members Cup. Terry Cooper delivered promotion, but a bank collapse put the Kumars' businesses into receivership. David Sullivan bought the club out of administration for £700,000 and installed the 23-year-old Karren Brady as managing director. They avoided relegation in 1992–93, but went down to the third tier in 1994. Barry Fry's first full season brought promotion as champions and victory in the Football League Trophy, beating Carlisle United via Paul Tait's golden goal.
The new owners had converted the stadium to all-seater, were to float the club as a plc, and saw Trevor Francis as the manager to take it forward. Francis introduced players with top-level experience, such as Manchester United captain Steve Bruce. They reached the 2001 League Cup final, losing on penalties to Liverpool, and three successive play-off semi-finals, losing all three, and lack of progress made Francis's position untenable. Bruce took the team from mid-table in November 2001 to the play-off final in which they beat Norwich City on penalties to win promotion to the Premier League. Motivated by World Cup-winner Christophe Dugarry, Birmingham's first top-flight season for 16 years finished in mid-table. Three years later, they were relegated in a season whose lowlight was a 7–0 FA Cup defeat at home to Liverpool. Bruce retained the confidence of the board and delivered automatic promotion in 2006–07.
In 2007, Carson Yeung invested in the club with a view to taking full control in the future. Uncertain as to his future under possible new owners, Bruce left in mid-season. His successor, Scotland national team manager Alex McLeish, was unable to stave off relegation, but achieved promotion back to the Premier League at the first attempt, and a ninth-place finish, their best for 51 years, the following season. Yeung completed a takeover, and the team won a second League Cup, defeating favourites Arsenal 2–1 with goals from Nikola Žigić and Obafemi Martins, but league form collapsed, they were relegated, and McLeish resigned. With the club in financial turmoil after Yeung's arrest on charges of money laundering, Chris Hughton's team narrowly failed to reach the knockout rounds of the Europa League and the playoff final before he too quit. Under Lee Clark, Birmingham twice retained their divisional status, albeit needing Paul Caddis's 93rd-minute goal in the last match of 2013–14 to avoid relegation on goal difference. Continued poor form saw Clark replaced by former Birmingham player Gary Rowett.
1965–79 Needing additional sources of finance to fund Birmingham's bid for immediate promotion back to the Football League First Division, the board approached Clifford Coombs, founder of home credit company S&U, for a loan. He agreed to put money into the club, but only if he could run it himself. He duly bought out the Morris family, promised to "find all the money I can afford. My heart is in Birmingham City and now my pocket will be as well", became chairman in January 1966, and lured Stan Cullis, manager of Wolverhampton Wanderers in their glory days, out of retirement. Cullis's team played attractive football, and average attendance doubled between 1965–66 and 1967–68.Matthews. Encyclopedia. pp. 20–21. Cullis led Birmingham to the semi-final of the League Cup in 1967, and in the 1967–68 FA Cup, they beat Arsenal and Chelsea in front of crowds in excess of 50,000 at St Andrew's before losing to West Bromwich Albion in the semi-final.Matthews (1995). Complete Record. p. 203. Cup success was not restricted to the first team: the youth team reached the final of the FA Youth Cup in 1967, losing to what was described as an experienced Sunderland team. Fourth place in the division in 1967–68 and seventh in 1968–69 preceded a slump towards the bottom of the table, and Coombs decided it was time for a change. He persuaded Cullis back into retirement in March 1970, and approached top-class managers, including Brian Clough and Peter Taylor and Don Revie, without success, before appointing Freddie Goodwin of Brighton & Hove Albion manager.Matthews. Encyclopedia. pp. 147–48.
He strengthened the spine of the team, bought in Carlisle United forward Bob Hatton, a club record signing at £82,500, to play up front alongside the home-grown Bob Latchford and introduced the 16-year-old Trevor Francis to first-team football. In 1971–72, Birmingham were not in the promotion places at any time during the season until after the last match, a win away at Orient that took them to the First Division as runners-up, overtaking Millwall, who had been in the top two for most of the campaign and whose supporters attended the match in large numbers to encourage Orient.
Goodwin had converted the attractive but inconsistent football of Cullis's teams to a skilful, aggressive game capable of drawing crowds – average home league attendance rose to over 32,000 – and maintaining top-flight status.Matthews (1995). Complete Record. pp. 37–38. Yet five years later, the Birmingham Mail sports editor, Dennis Shaw, wrote what a colleague described as a "a dossier of despair on the wasted seventies at St Andrew's. It was a chronicle of lack of achievement, sales of star players and unsuccessful replacements, growing disenchantment among the fans." Seven wins and a draw in the last eight matches took Birmingham to a mid-table finish in 1972–73, but by February 1974, the team lay 20th, the club needed to raise money, and Latchford was sold to Everton in a part-exchange deal: £80,000 cash plus players Howard Kendall and Archie Styles, valued at a British record fee of £350,000. Without a goalscorer of that quality, the team struggled,Matthews (1995). Complete Record. pp. 38–39, 209–15. but they avoided relegation, and stayed up again in 1974–75, as well as reaching another FA Cup semi-final. This time they lost to Second Division Fulham in a replay when, in the last seconds of extra time, a goalkeeping clearance rebounded off a Fulham player and trickled over the line.
In September 1975, Keith Coombs, who had recently succeeded his father as chairman, sacked Goodwin and appointed his long-time first-team coach Willie Bell as manager. Financial reasons forced the sale of players such as Peter Withe and Kenny Burns – both helped Nottingham Forest win the league title in 1977, and Burns was voted Footballer of the Year for 1977–78 – although Francis's written transfer request was rejected. The team struggled, and after two years in post, Bell was replaced by England's World Cup-winning manager Sir Alf Ramsey, who had been on the board at Birmingham since January 1976, and who agreed to take over so long as the job title was not manager but consultant. After six months, during which time the team remained near the foot of the table, star player Francis made increasingly public his desire to leave a club he saw as lacking ambition, and captain Terry Hibbitt spoke of what the Guardian Patrick Barclay dubbed a "crisis of morale", Ramsey recommended that both Francis and defender Joe Gallagher be sold. After the board backtracked on Francis, Ramsey left the club. Meanwhile, an action group known as the "Blue Revolution" had formed in an attempt to channel the increasing off-field discontent towards forcing change in the boardroom. Its public meetings were well attended, it organised a walkout of supporters from a match against Arsenal, and it publicly offered £250,000 to buy out the Coombs' holding in the club.
The appointment of Jim Smith, who as Blackburn Rovers manager had earned a reputation for playing attacking football, and the team's subsequent top-half finish went some way towards deflecting the criticism. Coombs also brought in Dennis Shaw as commercial manager, with the additional brief of improving the club's relations with press and public. Smith created a stir by signing Argentina's World Cup-winning full-back Alberto Tarantini. With relegation a certainty – the first league win came nearly three months into the seasonMatthews (1995). Complete Record. pp. 39–41, 214. – Coombs finally accepted that the only way to clear the club's £500,000 overdraft was to sell Francis, who had scored 133 goals in 329 appearances over his nine years at Birmingham.Matthews (1995). Complete Record. p. 88. He joined Nottingham Forest, becoming the first British footballer to be transferred for a fee in excess of £1 million; within weeks, he scored the winning goal in the European Cup Final.
1979–93: Decline and fall Smith invested the proceeds of the Francis sale in new signings and took Birmingham straight back to the First Division in 1980. After just two seasons back among the elite, Birmingham were battling against relegation and Smith was dismissed in a February 1982, to be replaced by Ron Saunders who had just resigned from league champions Aston Villa. The appointment did not go down well on either side of the city, and the comedian Jasper Carrott resigned from the board in protest. Saunders assembled a team full of "hard men" which struggled to score goals; in two years, average attendance had dropped by nearly 20%, to just over 14,000, and they were relegated again in 1984.Matthews, Complete Record, pp. 42, 219.
They achieved an instant return to the top flight, but promotion came at a cost. The last home game of the 1984–85 season, against Leeds United, was marred by rioting, and a 15-year-old boy attending his first match died when a wall collapsed on him. This was on the same day as an even greater football tragedy - the Bradford fire - and the events at St Andrew's formed part of the remit of the Popplewell inquiry into safety at sports grounds.