The Tar Heels could have used their senior star against the Panthers.
The Panthers used a 29-8 stretch over 12 minutes of the second half to turn a 50-34 deficit into a 63-58 lead and held on for the upset.
"Very disappointed in me, more so than my team. We acted like a team that had not been coached very well out there," North Carolina coach Roy Williams said. "Made a lot of mistakes."
Justin Jackson had 25 points for the Tar Heels (3-1), who didn't force a turnover in the second half.
Paige didn't play because of a broken bone in his right hand. The Tar Heels badly missed him, as Paige's replacement, Joel Berry, had just five points on 2-of-7 shooting.
"He's our best player offensively and defensively and as fine a young man as I've ever been around in my life, so I'd like to have him on the court," Williams said. "But North Carolina still plays."
The Panthers (2-1) beat the Tar Heels in the paint, 24-22, after Kennedy Meeks scored the first eight points for UNC.
Meeks finished with 10 points, a total matched by Brice Johnson. The 6-foot-10 and 6-foot-9 forwards never established the inside game for UNC, and the Panthers were able to exploit that the rest of the way.
North Carolina appeared to be in control in the first half, but Washpun made a half-court 3 at the buzzer to pull the Panthers within 41-32.
Wyatt Lohaus gave Northern Iowa the lead with 9:21 left, and the Panthers were able to finish off one of the biggest upsets of the young season.
"They had to play their tails off in that second half. The game was just about over with 15 minutes left, and our guys hung in there and made a couple shots," Northern Iowa coach Ben Jacobson said. "That last 10 minutes, I couldn't ask any more from our guys."
It was the biggest win for Northern Iowa since 2010, when it stunned top-seeded Kansas to reach the Sweet Sixteen.
North Carolina: The Tar Heels committed 12 turnovers. ... Nate Britt was 1-of-6 shooting and finished with four points. ... It was the first meeting between the schools and the first for North Carolina in Iowa since losing to the Hawkeyes in 1989.
Northern Iowa: The Panthers were hosting a top-10 opponent for just the third time. Northern Iowa beat No. 10 Iowa 84-78 in 1997 and lost to fourth-ranked Wichita State 82-73 two years ago. In fact, five of UNI's past seven ranked opponents were the Shockers. ... The Panthers made a 3 for the 498th straight game, the longest current streak among Missouri Valley schools. ... Bohannon played with Paige at Linn-Mar High.
Northern Iowa plays Dubuque on Wednesday.
North Carolina faces Northwestern on Monday.
Auburn Tigers No. 1 for first time in history of AP Top 25 men's basketball poll
A barely ranked afterthought to begin the season, Auburn climbed past Gonzaga to No. 1 in the AP Top 25 poll released Monday.
College basketball Power Rankings: Auburn Tigers stay steady at the top as Houston and UCLA jump up
Auburn continues to prove it's a No. 1 team, Marquette is on a winning streak and some conferences seem to be one-team title races.
Colorado State Rams play the Nevada Wolf Pack on 4-game win streak
Nevada Wolf Pack (9-7, 3-2 MWC) at Colorado State Rams (15-1, 5-1 MWC)