It was a far from impressive performance from the Championship leaders who have not played well this season despite their unbeaten record.
The stalemate was not broken until the 83rd minute when Larsson's fellow on-loan colleague from Arsenal, Nicklas Bendtner, created the opening for the little winger to cut in and beat Shrews hero, Chris MacKenzie.
They may have had no less than ten changes from the side which beat Crystal Palace last Saturday, but were obviously far superior to their lower division opposition despite the closeness of the score.
But they were often guilty of showboating as they made far too many passes in their build-up moves often not getting into the Shrews area in the goalless first half.
They failed to take note of their first minute opening engineered by Larsson which ended with Mikael Forssell's shot being deflected over the bar.
By far Birmingham's best chance occurred in the 15th minute when Neil Danns worked his way into a firing position only to see goalkeeper MacKenzie make a brilliant diving save.
Very little was seen of the Shrews as an attacking unit. They were usually contained in midfield, but a snappy through ball from Danny Hall found Ben Davies running through on his own.
Colin Doyle, making his debut for Birmingham, displayed some smart anticipation as he raced from his goal to nullify the situation as he blocked the shot from Davies.
There was little excuse when Fabrice Muamba, one of three Arsenal youngsters on loan at Birmingham, broke through the middle only to scoop his shot over the bar with the goal at his mercy.
Meanwhile, the ever-dangerous Dave Edwards continued to inspire Shrewsbury with his tenacious play and never give up spirit with a shot on the turn demonstrating his potential danger.
As at the beginning of the game Forssell was thwarted from opening his account at the start of the second half when MacKenzie bravely saved at the feet of Birmingham's striker.
Birmingham continued to bombard Shrewsbury but with little conviction as their lowly opposition defied their big-time rivals.
As a result, Birmingham replaced their two strikers, Forssell and Cameron Jerome, with Bendtner and DJ Campbell.
A gritty Shrewsbury deserve full credit for their battling performance. They got behind the ball and when Birmingham did put themselves into a goalscoring position, the inspired MacKenzie kept them in the game as he demonstrated with another outstanding save to foil Danns.
But he had little chance with Larsson's classy goal that was a rare piece of quality.