Saif Zaib scored a T20 career-best 92 but it was not enough as the Falcons claimed the points at Derbyshire.
Zaib revived the Steelbacks after a dicey start to the powerplay saw the visitors three down after the opening six overs.
Chris Lynn skied a swing at Sam Conners and Madsen held a steepling catch at cover before Hayden Kerr removed Josh Cobb. The Steelbacks skipper drove and pulled Conners for four consecutive fours but then lost his off stump making room to cut Kerr.
That followed Ben Curran’s miscued clip at Mark Watts into the hands of mid on and at the end of six overs, the Steelbacks were 58 for 3.
Rob Keogh was caught off a George Scrimshaw no ball but after hitting the free hit to the boundary, top edged a pull to third man.
Jimmy Neesham drove Conners over long off for the first six of the innings and Zaib added a second when he cut Scrimshaw over wide third man in the 12th.
Zaib mixed improvisation with placement to reach 50 off 36 balls but the introduction of Matt McKiernan in the 15th over removed the dangerous Neesham who was stumped charging the leg spinner.
The Steelbacks plundered 22 from the 17th over when Zaib swept and drove McKiernan for two sixes but Scrimshaw and Watt conceded only 10 off the next two.
Zaib pulled Kerr for his fourth six before he was selflessly run out looking for a tight second. It ended a superb innings of 92 in just 58 balls, his second half century of the campaign including 8 fours and 4 sixes. Lewis McManus thumped the last ball for six to take his side to a competitive total.
The Falcons lost Luis Reece in the first over when he chipped a return catch to Cobb but Kerr pulled Tom Taylor for six and repeated the shot against Ben Sanderson as 16 came from the last over of the powerplay.
Kerr swung the first ball from Freddie Heidreich into the hands of deep midwicket and the wrist spinner can consider himself unlucky not to have a second in the over, Madsen fortunate to survive a strong LBW appeal on 1.
Madsen made the most of his early reprieve when he drove and pulled Neesham for two fours to leave the Falcons needing 97 off the last 10 overs and he reverse swept Graeme White for six as 14 came from the 11th over.
The Steelbacks were struggling to contain the pair with Masood steering Sanderson to the third man boundary on his way to a 36 ball 50. Cobb returned but Madsen ramped him for two fours as the Falcons accelerated towards their target.
A reverse swept six took Madsen to a 24 ball 50 and although Masood holed out to long on, only 36 were needed off the last five overs. Madsen was caught behind off Neesham in the 19th over but the game was over as a contest.
The Steelbacks go again tomorrow night at home against the Birmingham Bears.