First-half goals by Yossi Benayoun and David Ngog gave the home side the initiative before an own goal on the hour from Hammers keeper Robert Green helped lift Liverpool into sixth place in the Premier League on 59 points.
They trail fourth-placed Tottenham Hotspur, who have a game in hand and have four matches left to play, by five points.
Realistically though Liverpool's only hope of adding some cheer to a torrid season after early exits in the Champions League and FA Cup lie in Thursday's semi-final, first-leg match in the Spanish capital.
Gerrard created Liverpool's opener when his cross was guided goalwards by Benayoun on 19 minutes, the Israeli deflecting thw ball home with his chest.
Ngog's neat finish from Maxi Rodriguez's centre ten minutes later might have been saved by Green, whose hesitancy from another Gerrard centre just before the hour mark allowed defender Sotiris Kyrgiakos to poke goalwards only for the ball to hit the far post and cannon in of Green's leg.
"I think everyone's got a soft spot for West Ham. Hopefully they can stay up," Liverpool defender Jamie Carragher told ESPN after the match, his views echoed by former Hammer Benayoun.
"I didn't celebrate because I still have feelings for this club and I really hope they will stay up," he said.
