DERBY CLASH: Holsworthy's Tom Cole battles with Launceston's Liam Tilley.
The Magpies took an early lead through Alan Clarke but were undone by goals from Sam Scott, Dominic Richardson and Sam Davey.
A third consecutive league defeat leaves them just one point above the drop zone in the Carlsberg South West Peninsula League Premier Division.
Despite their poor run of results, the visitors, who saw joint manager Keith Rickard step down last week, made a bright start.
Clarke connected with a superb pass from Tom Cole to open the scoring on 15 minutes.
The Clarets were level after half an hour when 17-year-old goalkeeper Ryan Walter allowed a cross from Scott to drift over his head and straight in.
Richardson and Davey both wasted glorious close-range openings before half-time but the pair combined for the second goal after a catalogue of errors in the Holsworthy defence.
Walter's scuffed goalkick was miscontrolled by Wayne Riley, leaving Davey to charge goalwards.
Although Lee Rundle got back with a sliding challenge, the ball ran for Richardson to tap into the empty net on 68 minutes.
The pace of Davey took him clear of central defender Gary Clarke in the build up to the third Launceston goal with seven minutes left.
Substitute Adam Yeo had his shot handled by Riley and Davey slammed home the resulting penalty.
Holsworthy: Ryan Walter, Wayne Riley, Danny Allen, Lee Rundle, Gary Clarke, Lee Morgan (Lee Clarke 84), Athony Giordani (Jason Pontin 75), Steve Murphy, Stuart Rickard, Tom Cole, Alan Clarke.