The Dolphins appeared to have blown a chance at victory on their next-to-last drive when Jay Fiedler's pass on third-and-goal from the 2 was bobbled by Randy McMichael just inside the end zone and intercepted by Jets linebacker Victor Hobson.
But the Dolphins stopped the Jets, thanks in part to an offensive pass interference penalty on tight end Anthony Becht, and started their last drive at the Jets 49-yard line.
The Dolphins drove 45 yards mainly on the strength on the Fiedler-Chris Chambers combination.
It was a career day for both; Fiedler passed for a career-high 328 yards, while Chambers had new career highs in receptions (9) and receiving yards (153).
Three of those connections, good for 36 yards, came on the last drive.
Chambers also caught a 20-yard touchdown pass to give the Dolphins a 20-7 lead with 2:55 left in the second quarter.
But the Dolphins started self-destructing after that. Some of the miscues included giving up a safety when Jeff Grau's snap sailed over the head of punter Matt Turk; Turk mis-hitting the ensuing free kick; Olindo Mare missing a 53-yard field goal attempt wide right; and the McMichael bobble on the interception.
The Jets took the lead 21-20 on Chad Pennington's 1-yard touchdown pass to Becht with 8:58 left in the fourth quarter. The Dolphins caught a break on the ultimately very important two-point conversion when Pennington underthrew a wide open Becht in the back of the end zone.
The Dolphins jumped out to a 13-0 lead in the first half behind two Mare field goals and a 16-yard touchdown run by Ricky Williams.
The victory gave the Dolphins a 10-6 record, making them the first team since the 1991 Philadelphia Eagles and San Francisco 49ers to win 10 games and fail to make the playoffs.