Former manager Stevie Crawford netted a brace as East Fife hit Stenny for six.
David Muir opened the scoring, tapping home from Robert Sloan's cross before goals from Crawford and Craig Johnstone put the Fifers in control.
Sloan then netted from the penalty spot before a stunning Bobby Linn long-range strike and Crawford's second goal completed the rout.
The visitors' woes were compounded when Alex Williams was shown a straight red card for a foul on Scott Durie.
East Fife: Michael Brown, McGowan, Steven Campbell (Durie 72), Smart, Ovenstone, Linn (Young 74), Sloan, Muir, Johnstone, Crawford (Byrne 71), Hislop. Subs Not Used: Baillie, Murdoch.
Goals: Muir 19, Crawford 32, Johnstone 33, Sloan 45 pen, Linn 61, Crawford 68.
Stenhousemuir: Brown, Lyle, Smith, Thom, Gibb (Dickson 79), Anderson, Thomson (Williams 47), Scuillion, Murray, Quinn (Plenderleith 70), Stirling. Subs Not Used: James McLennan, Motion.
Sent Off: Williams (72).
Booked: Brown.
Att: 472
Ref: K Clancy (Scotland).
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