Rovers looked to be heading for victory when Jennison Myrie-Williams put them in front with a header from Andrew Taylor’s cross in the third minute.
But the game swung the other way when Rovers defender Ben Chorley fouled Kevin Betsy in the box in the 39th minute and was sent off.
Although goalkeeper Danny Coyne saved Tommy Mooney’s spot-kick, Rovers lost their grip and in the 45th minute Alassane N’Dour equalised for Walsall.
The Saddlers took the lead in the 59th minute, substitute Ishmel Demontagnac scoring with a low drive from Mooney’s back header.
Tranmere kept pushing forward trying to snatch a point and in the 79th minute Ian Goodison missed a great chance to equalise when he dragged his shot wide.