The league leaders moved in front after 11 minutes when Ryan McGuffie prodded the ball home.
Forfar equalised four minutes later through Chris Templeman but Queens hit back, Derek Lyle powering in a header. Nicky Clark added the third after 71 minutes.
Alloa Athletic 1, East Fife 1
Alloa had to settle for a point against visitors East Fife
Paul McManus was set up by Collin Samuel and the East Fife striker beat Scott Bain with a right-foot shot, but Jason Marr equalised ten minutes from half-time with a fine header, set up by Ryan McCord.