Blackstock put Forest in control after 18 minutes with Poland international Radoslaw Majewski and Chris Cohen then making the game safe with strikes at the start of the second half.
Forest, who have now stretched their unbeaten run to 18 games, were well worth the margin of their victory after a classy display.
They were dominant all over the pitch as Albion crashed to their fourth home defeat of the season.
Albion had been chasing a win to close the gap on leaders Newcastle United to three points.
But they never got into gear on a freezing cold night at The Hawthorns as Forest - who remain the only side unbeaten away from home this season - leapfrogged them and pushed Albion out of the top two for only the second time since August.
All Albion had to show for their efforts was a 64th minute consolation strike from Roman Bednar, who converted a long cross field ball from Graham Dorrans.
But that was too little, too late as the damage had already been done by then.
Ironically, Albion could have taken charge before Blackstock struck after Simon Cox dispossessed Chris Gunter and released Jerome Thomas in the 10th minute.
Thomas homed in on goal only for a last ditch challenge by Wes Morgan to deflect his shot wide.
It was a vital intervention by Morgan and Forest took full advantage through the predatory instincts of Blackstock.
Blackstock helped set up his goal as he won a corner in a tussle with Jonas Olsson.
When Majewski sent over the resulting cross, Blackstock held off the challenge of Albion's debutant central defender Gabriel Tamas to volley the ball home from eight yards.
Ultimately that was the beginning of the end for Albion and their fate was sealed in a three-minute spell shortly after the interval.
Majewski struck with a stunning 53rd minute far-post volley when he met a pinpoint cross from Gunter.
Albion were still reeling from that setback when Guy Moussi teed up Cohen to slide home a low shot from the edge of the area thee minutes later.
The only other plus point Albion could take from the game was the 77th minute appearance of striker Ishmael Miller, who made his return after a 13-month absence with a knee injury.