Goals: Murphy 9' (pen) - Kalou 54', Ballack 63' (pen)

Chelsea ensured an unhappy New Year's Day for Roy Hodgson at Craven Cottage as his first match as Fulham manager ended in a 2-1 home defeat in the west London derby here on Tuesday.

For all their effort and positive play, Fulham were edged out by a near second-string Chelsea side, which still had the experience required to beat their hosts in the first English Premier League fixture of 2008.

Hodgson's Fulham career got off to the best of starts when Danny Murphy scored a 10th-minute penalty, awarded for an apparent trip by Joe Cole on Moritz Volz, though there appeared to be little contact, if any.

Ivory Coast striker Salomon Kalou equalised with a 54th-minute header before Blues captain Michael Ballack won and converted a penalty in the 62nd minute following some shirt tugging by Clint Dempsey.

Chelsea stay third in the Premier League table and still in the title hunt, while their less illustrious neighbours from a mile (two kilometres) down the Fulham Road remain second-bottom.

Ballack admitted it took some stinging half-time criticism from Chelsea manager Avram Grant to lift them out of their lethargy.

"It was a little bit loud in the dressing room but we needed this result," Ballack said. "We couldn't keep playing like we did in the first half so we changed a lot. We put pressure on Fulham and it was better for us.

"It's a great pleasure for me to captain Chelsea but it's more important we come through this difficult period because we have a lot of injured players."

Hodgson, whose CV includes spells with Switzerland, Finland, Inter Milan, Udinese, Blackburn Rovers, Malmo, Grasshopper and FC Copenhagen, was given a warm reception by Fulham's fans.

And they had more to cheer when Senegal striker Diomansy Kamara tested the Blues' third-choice goalkeeper Hilario with a low shot before Kalou and Shaun Wright-Phillips got in early shots on Antti Niemi's goal.

Hodgson's reign at Craven Cottage then got off to a flying start.

Full-back Volz cut into the penalty box where Cole, admittedly tackling from behind, was ruled to have brought the defender down. If there was any contact, it was minimal and the England midfielder protested his innocence.

Murphy took the resulting penalty and scored low to the left as Hilario dived the other way.

The Blues attempted to regroup and Kalou had the ball in the net in the 17th minute. Hoewever, play was correctly stopped for his handball.

In the 26th minute, Finland international Niemi charged out to the edge of his box and hauled down Kalou, but the Chelsea striker was offside.

Midfielder Murphy then curled a free kick over the bar and Kalou sent a near-post header wide.

Fulham's Simon Davies wasted a good chance in the 35th minute when Blues right-back Juliano Belletti completely missed the ball. But the Wales winger lost his momentum when he checked inside and Chelsea cleared.

The Blues were incensed in the 51st minute when Wright-Phillips's attempted cross clearly hit Fulham captain Dejan Stefanovic's arm in the penalty box but referee Mark Halsey waved away Chelsea's penakty appeals.

But the visitors had their equaliser three minutes later.

Alex headed fellow Brazilian defender Belletti's corner back across goal for Kalou, who got the better of Volz to crash in a header.

Chelsea then took the lead in the 62nd minute, Ballack tumbling in the penalty box following a free kick as United States midfielder Dempsey tugged at his shirt.

Ballack struck the resulting spot-kick in exactly the same place as Murphy.

The midfielder then fired a fierce 68th-minute free kick just wide.

Hodgson threw on South Korea striker Seol Ki-Hyeon, Northern Ireland forward David Healy and former Blues midfielder Alexey Smertin as the hosts pressed for an equaliser.

But Chelsea closed out the match on the banks of the River Thames to secure local bragging rights.

Fulham: Niemi; Omozusi, Bocanegra, Stefanovic, Konchesky; Volz (Seol 67'), Davis (Smertin 69'), Murphy, Davies; Dempsey, Kamara (Healy 76').

Chelsea: Hilario; Belletti, Alex, Ben-Haim, Bridge; Essien, Ballack; Sidwell (Mikel 46'); Wright-Phillips (Pizarro 87'), Kalou; J Cole (Ferreira 90').