The Buckeyes' loss at home to the last-place team in the Big Ten Conference was Ohio State's fifth setback in six games. That collapse has come after Ohio State had won its first 15 games of the season.
Newbill tied the game with a 3-pointer with 11 seconds to play in the second half and the Buckeyes were unable to convert on either Lenzelle Smith's 3-point try or Shannon Scott's layup attempt after he grabbed the offensive rebound.
Ohio State had the ball and a three-point lead late in overtime, but Aaron Croft missed a jumper with 1:24 to go and Newbill hit a layup that brought the Nittany Lions within one with 50 seconds remaining.
The Buckeyes then committed a turnover, leading to Newbill's game-winning shot.
Newbill scored 25 points and had seven rebounds to pace Penn State (11-10, 2-6 Big Ten). Brandon Taylor added 19 points for the Nittany Lions.
LaQuinton Ross had 16 points for Ohio State (16-5, 3-5 Big Ten), which shot 37 percent from the field.
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