Berwick, after a great a season, ended with nothing but they regained their pride with a fine second-half display.
In the opening 20 minutes their reshuffled side took a battering as Alloa unleashed a bombardment of long throws, allied to skilful lead-up work.
After 18 minutes the stylish James Stevenson created space on the left and crossed perfectly for Ross Hamilton to glance in a header.
Rangers began to find their rhythm and were awarded a penalty for a push on Gareth Hutchison, but Kevin McLeish saw his shot brilliantly saved by Allan Creer.
They could had had another when the visitors escaped punishment for handball.
In the second half Berwick stormed on to the attack and exerted heavy pressure.
Robbie Horn, man of the match, equalised with a header ten minutes from time.
McLeish, who had swung in a fine corner for the first goal, did it again and after Mark Cowan headed down, Horn forced it home.
Danny Swanson and McLeish then went close and Creer pulled off a series of fine saves.
All credit to Alloa for their last-gasp escape and their determination. For Rangers, now likely to lose many of their squad, it was a bittersweet victory.