"It was an intense game with a bit of everything," said Alonso. "In the first half it was complicated for us but we knew how to react and came out well in the second half."
Diego Forlan scored a penalty to give the visitors hope five minutes later but Real held on for a 15th consecutive league home win to move back above Barcelona on goal difference.
"We have to think about Racing (Santander) next weekend because it is a tough game and if we think of Barcelona we will have problems," said Real midfielder Esteban Granero.
"We have a lot of points but there is another team (Barcelona) winning a lot of games that we want to take the title off."
For Atletico their derby jinx continues and they have not beaten Real since a 3-1 win way back in October 1999 when Claudio Ranieri was in charge and lie five points off the top six.
Champions Barcelona became only the second team to win at Mallorca on Saturday with Zlatan Ibrahimovic's goal securing a 1-0 win to take them top of the table although Real have now replaced them with just one game to go before 'El Clasico' on the weekend of April 10/11.
The Champions League is the next stop for Barcelona, with a tough quarter-final first leg trip to Arsenal on Wednesday.
Real fell behind on 10 minutes as Atletico worked the ball cleverly from left to right and Reyes curled a first time shot into the corner.
Reyes used to play for Real and scored two goals on the final day of the 2007 season to help them win the league title with a 3-1 win over Real Mallorca.
Atletico looked increasingly dangerous before Real began to pose a threat themselves through Ronaldo and Higuain.
Higuain seemed destined to score on 38 minutes after circling goalkeeper David de Gea close to the goal-line but Tiago made a fantastic last-ditch block.
Forlan then missed a chance for Atletico before Ronaldo wasted a golden opportunity shooting wide on the stroke of half-time.
Kings Cup finalists Atletico knew of the goal potential of the league's top-scorers Real and sure enough Real were ahead 10 minutes into the second half with two goals in six minutes.
On 49 minutes Raul Albiol headed back and Alonso fired in an equaliser before the Spain star turned the architect for the second goal in the 55th minute.
Alonso released former Liverpool team-mate Arbeloa who controlled well on his chest and slotted past de Gea.
Higuain hit the crossbar but a mistake from Tiago let him in on 62 minutes and the Argentine made no mistake.
A handball in the penalty area from Alonso allowed Atletico a route back into the game five minutes later with Forlan converting and the Uruguayan had an opportunity late on but fluffed his chance as the game finished 3-2 - the same scoreline as the first derby at the Vicente Calderon.
Elsewhere new Sevilla coach Antonio Alvarez had a debut to forget as his side crashed to a 3-0 defeat at Villarreal, missing the opportunity to move above Real Mallorca into fourth.
Alvarez took over from Manolo Jimenez, sacked on Tuesday, but got off to a horrible start as the visitors fell two goals behind after just 17 minutes and, despite an improved second half, could not find a way back into the match.
Brazilian Nilmar created early goals for Giuseppe Rossi in the fourth minute and Joseba Llorente as Villarreal seized control before Robert Pires added an injury-time third.
Victory moves Villarreal to within two points of the top six.
Sevilla sit two points behind Mallorca, beaten 1-0 by Barcelona on Saturday, in fifth, having failed to win any of their last six league matches and they face a real fight to qualify for next season's Champions League.
It has been a nightmare March for Sevilla with a last-16 exit from the Champions League to CSKA Moscow, no wins in the league and the sacking of Jimenez, who had guided the club to this season's King's Cup final.
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