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Milan, boosted by their 2-0 midweek win over Barcelona in the Champions League, took a 21st minute lead through striker Stephan El Shaarawy.
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Lazio's chances of getting anything from the game were dealt a fatal blow when Antonio Candreva was shown a straight red after 17 minutes for a foul on Stephan El Shaarawy.
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However, Balotelli had the final say with a trademark penalty in the fourth minute of time added on after Stephan El Shaarawy went down under what looked like a fair tackle from Thomas Heurtaux.
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The fourth-placed home side -- at that point 2-1 down and playing with 10 men since before halftime after Nenad Tomovic was sent off for elbowing Balotelli's strike partner Stephan El Shaarawy -- fought back to equalize through a late penalty by David Pizarro.
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