A solitary second-half strike from Daniel Afriyie Barnieh was enough to secure a priceless victory for the Accra-based side.
In a half-full stadium, Hearts took a major step towards ending their decade-long trophy drought, to the delight of their thousands of cheering fans.
The Phobians made their attacking intent clear from the onset, but it was Kotoko who got the first shot on target after a goal-bound free-kick from Patrick Asmah was parried away by goalkeeper Richard Attah.
Shortly after, Hearts also went close with Raddy Ovouka initiating a solo run before firing straight into the waiting arms of Kwame Baah.
Samuel Boadu’s side ended the first half with the best chance falling to Fatawu Mohammed, whose fierce shot struck the post, only for Obeng Junior’s rebound to also be blocked.
The second half followed the same pattern as the first, with Hearts starting on the ascendancy while Kotoko sat deep in their half.
And it didn’t take long for the Phobians to make their first attacking threat, as Salifu Ibrahim’s free-kick was punched away by Baah.
The home fans got louder as the game progressed and their side responded by taking the lead in the 64th minute following a sustained period of possession.
A shot from outside the box was deflected onto the path of Afriyie Barnieh, who rifled the net with a first-time volley.
Total pandemonium inside the Accra Sports Stadium as he raced to the bench to celebrate with Boadu and the other technical team members.
Kotoko manager Mariano Barreto made some changes in a bid to influence the game and substitute Augustine Okrah had the best chance to restore parity when he was left unmarked in the Hearts box, but his shot was feeble, allowing Attah to calmly collect the ball.
Despite launching a series of last-ditch attempts to get the equaliser, Hearts held firm to record a very important victory over their rivals.
The result means the Phobians have now moved three points clear of Kotoko on the league table, and boosted their hopes of winning the title for the first time in 11 years.