Atletico trounce nine-man Valencia
Leaders Barcelona and second-placed Real Madrid both won on Saturday and the campaign is looking increasingly like a two-horse race with Barca two clear at the top on 61 points from 24 matches and Real second on 59.
Valencia are 13 points behind Real on 46 in third and Sevilla are fourth on 43, three ahead of Real Mallorca, who won 2-1 at struggling Real Valladolid earlier on Sunday.
Atletico, who had a woeful start to the season but have since climbed to 11th and are the only team to beat champions Barca this season, have 30.
The match at the their Calderon stadium sparked into life in the 21st minute when the referee waved away Atletico's appeals for a penalty and Valencia swept forward for Spain international David Silva to put the visitors ahead.
Television replays suggested Valencia midfielder Ever Banega had chopped down Jose Antonio Reyes in the penalty area but winger Joaquin raced away and released Silva, who finished low past home goalkeeper David De Gea at the second attempt.
There was more controversy shortly after when the referee missed a handball in the area by Valencia captain Carlos Marchena.
He stopped play after the Atletico players protested and consulted the fourth official before sending Marchena off and awarding a penalty converted by Forlan.
Valencia keeper Cesar Sanchez was on fine form and produced excellent second-half saves to deny Simao Sabrosa, Reyes and Sergio Aguero.
Argentina striker Aguero looked to have picked up an injury with around 15 minutes left but before he could be replaced he nodded in a Simao free-kick.
Defender Miguel Monteira was shown a straight red for a wild challenge on Juan Valera in the 82nd, Forlan grabbed his second with a cool finish four minutes later and substitute Jurado curled in a fourth in added time.
Sevilla's hopes of a third straight league win were dealt a blow in the 52nd minute when midfielder Ndri Romaric was shown a straight red card for a foul on Ander Iturraspe on the edge of the penalty area.
In other matches earlier on Sunday, Deportivo La Coruna's chances of taking one of Spain's four Champions League qualification places receded when they lost 1-0 at Villarreal.
Depor remain on 38 points and surrendered fifth spot to Mallorca, whose victory at Valladolid was only their second away success of the campaign.
Espanyol drew 1-1 at bottom side Xerez, Sporting Gijon battled back from 2-1 down to beat visiting Osasuna 3-2 and Almeria won 2-0 at Racing Santander.
Argentina forward Lionel Messi netted Barca's late winner in a hard-fought 2-1 victory at home to Malaga on Saturday and his in-form compatriot Gonzalo Higuain scored twice as Real trounced struggling Tenerife 5-1 away.