In July 2000, Horsfield signed a five-year contract with Birmingham, who paid a club record fee of £2.25 million, £350,000 of which went to Halifax Town under the sell-on clause. He was their top scorer in his first season, finding the net on twelve occasions, and his two goals in the second leg of the League Cup semi-final helped the club reach their first major final for nearly 40 years. In the starting eleven for the final against his boyhood heroes Liverpool, Horsfield had been substituted by the time Birmingham lost in a penalty shootout.