The Reds have now opened a lengthy gap at the top of the table as Manchester City were beaten for the third time in four league games - losing 2-1 to Leicester City at the King Power Stadium while Tottenham Hotspurs climbed into second courtesy of a 5-0 win against Bournemouth.
It's now eight consecutive league wins for the Merseyside juggernauts who strolled to their 16th domestic win of the season thanks to an early screamer from Dejan Lovren, while goals in the second half from Mohamed Salah, Xherdan Shaqiri and Fabinho capped off the Newcastle massacre.
The Reds are also unbeaten in 30 league games at Anfield as their home fortress took yet another victim as Liverpool put their former manager Rafael Benitez and his Newcastle team to the sword to make it a perfect Boxing Day all-round for Klopp's table toppers.
Lovren screamer opens early proceedings
Klopp made three changes to the team that dispatched Wolves 2-0 at Molineux on Friday as Trent Alexander-Arnold, Shaqiri, and Gini Wijnaldum all came in for Naby Keita, Fabinho and James Milner.
Benitez made six changes to the team that was held to a goalless draw against Fulham on Saturday. Yoshinori Muto, Isaac Hayden, Kenedy, Federico Fernandez and DeAndre Yedlin all came into the fold while the most noticeable absentee was their Premier League top-scorer Salomon Rondon who was left on the bench.
The games early chance presented itself surprisingly to the visitors on the stroke of nine minutes. Matt Ritchie delivered a marksman like delivery into the Liverpool box eluding both Lovren and Virgil van Dijk into the path of Joselu who lacked conviction and accuracy as his header went agonisingly wide.
Liverpool began to find their fluidity and flair and fathomed their first real effort at goal with a superb link up on the right-hand side between Roberto Firmino and Sadio Mane. The forward duo intricately teased the Newcastle defence with their swift passing before presenting the ball to Shaqiri on the six-yard box, but, the Swiss international failed to connect with the ball and his shot fell wide.
The inevitable goal finally took its course from a Reds set piece and what a goal it was. A short free-kick came into the path of Andy Robertson who lofted a teasing cross into the Newcastle area that was cleared by Magpies skipper Jamaal Lascelles.
What followed was a strike out of the top draw as the ball fell to none other than Lovren who didn't hesitate to unleash a thunderbolt on the half-volley into the top-corner leaving keeper Martin Dubravka utterly helpless to proceedings.
The opening goal sparked a sense of ruthlessness from Klopp's team who maintained possession with ease. Newcastle despite the run of play again had a chance squandered when another Ritchie set-piece went unpunished from another Muto missed header.
Mane and Firmino played with flamboyance and a reverie that toyed with the Newcastle back-line. The duo were exquisite with their one-touch link-up play that almost allowed Shaqiri to almost double the advantage but his effort came short.
Liverpool's early dominance was encapsulated by their No.1 Alisson Becker whose urgency to start a beautiful counter-attack highlighted the drive and tenacity Klopp had encouraged his players to demonstrate early on.
The Brazilian international found Shaqiri with an exquisite through ball. The Swiss magician teed Salah on the far right who looked to unleash Firmino but the cross just eluded the Reds No.9 and was cleared for a corner.
Shaqiri looked a man on a mission in the opening period and his free-kick just shy of half-time again almost doubled the Reds advantage. The former Stoke man unleashed a venomous effort that was just tipped over by Dubravka.
Second Half rout opens lengthy lead at the top
The hosts carried on where they left off and doubled their advantage within minutes of the second period. Salah may have been fairly quiet in the opening 45 minutes but you can't keep the Reds Egyptian King out of proceedings for too long.
The Liverpool forward was found darting through towards the Magpies goal before being impeded on the shoulder by Dummett leaving referee Graham Scott no choice in pointing to the spot.
It was the Reds leading scorer who took the spot kick and did so in an expert like fashion - finding the bottom left-hand corner with a thunderous side foot.
Interestingly it was Liverpool's first league spot-kick since November 2016 as Salah extended his goalscoring tally to 15 in all competitions this season. And, to think there were some who doubted him early on this season.
Liverpool began to smell blood and their prowess would not be hindered by anyone who attempted to get in their way. The Reds found a third and capped off the win with 10 minutes to play following a superbly orchestrated team manoeuvre.
Substitute Daniel Sturridge passed to Jordan Henderson who slid through Alexander-Arnold with a delicate pass. The England international crossed a superb delivery into the path of Shaqiri who ruthlessly tucked home.
The rout didn't stop there as the Reds made it 4-0 for the third time in the league this season when Fabinho came off the bench to score his first ever Liverpool goal and cap off another three points for Klopp's team.
Liverpool's closest opposers are now Spurs who comfortably won 5-0 at Wembley to leapfrog champions City into second place.
The Reds will now turn their attention to another crunchtime fixture as they welcome top-six rivals Arsenal to Anfield on Saturday to lay further foundations to their illustrious title credentials.