AA controversial penalty from Oxford captain Andy Crosby kick-started his side's promotion push after they had gone six games without a win.
Crosby netted from the spot in the 25th minute after the referee pointed to the spot after he had judged that Crosby had been pushed by Cheltenham keeper Shane Higgs.
It looked a regulation challenge, but the referee had other ideas much to the annoyance of the Cheltenham players.
The win moves Oxford to just one point off the third automatic promotion place, and gave everybody connected with the club a big lift.
A further boost came when manger Ian Atkins named striker Steve Basham in his starting line-up - United's leading scorer has been sat on the sidelines for the past month with a hamstring injury.
And Basham made a tremendous difference to the United side who dominated large parts of the game, but offered little threat in front of goal.
To their credit, Cheltenham battled throughout and but for some last-ditch defending by the home side, would have snatched a point.
Martin Devaney twice went close with right-foot shots inside the opening 25 minutes, while at the other end Basham saw his shot easily saved by Higgs.
Having conceded the penalty, Higgs more than made up for his error, when making a top-class double save to deny Barry Quinn and former team-mate Julian Alsop.
Quinn's fierce shot from outside the area was tipped around the post by Higgs at full stretch for a corner.
And from Dean Whitehead's flag kick, Alsop's towering header was somehow kept out by Higgs on the line.
After the break, neither side could find the killer instinct in front of goal, but Cheltenham went the closest.
Substitute Bob Taylor saw his shot from eight yards deflect off Oxford defender Paul McCarthy and go behind for a corner.