Sergio Aguero's stunning solo strike was enough to hand Manchester United their first Premier League defeat in 18 matches.
James Milner had opened the scoring early in the second half for the Blues, before a Vincent Kompany own goal less than ten minutes later tied things up.
But the Argentine forward proved the difference in a game where few United players stood out.
Here are the player ratings for the Red Devils on a disappointing night:
David de Gea: 6
The increasingly reliable Spanish keeper had little to do against Manchester City except pick the ball out of his net a couple of times.
A very harsh critic may suggest he could have gotten a stronger hand on Aguero's winner, but this would be unfair.
Returning to the United starting lineup, Rafael looked eager to assert himself on matters going forward.
But the Brazilian full-back's touch let him down far too often, losing possession in the final third on several occasions.
Was perhaps unlucky not to score when his snap-shot volley struck the woodwork in the first half.
Phil Jones: 7
A decent game from the young centre-back who showed plenty of his typical doggedness and determination.
He was in the right place at the right time to semi-convert Robin van Persie's free kick, even if his attempt almost denied United a goal rather than creating one.
Rio Ferdinand: 6
Not much to write home about for Rio Ferdinand as his pace was exposed a couple of times by the smaller, quicker City forwards.
2013 has been a horrible year for the veteran defender, but he will surely have a place at Old Trafford beyond this season.
Patrice Evra: 5
This season has seen a marked return to form for the French left-back, who has been a greater influence both in defence and in attack.
But Monday night's game saw him slip back into old habits. Too often his slowness allowed for too much space for David Silva and Co. down his wing, showing his increasing age.
Ryan Giggs: 4
Oh dear. Like Evra, Ryan Giggs has had a bit of a renaissance season and has looked to be really hitting top form for the Red Devils in recent weeks.
Against City, he was close to terrible. His needless backheel directly led to the opening goal, while in general, his touch and passing were off.
Michael Carrick: 5
It is almost considered poor form within the Manchester United community to criticise Michael Carrick—he is considered the true unsung hero in the team (and rightly so).
But on Monday night, he didn't look his usual self, allowing City to dictate the flow of the game in the middle of the park while not asserting himself in possession.
The game was lost in midfield.
Danny Welbeck: 5
It's an analogy I've used before, but nothing sums up Danny Welbeck's game more than a dog with plenty of bark, but little bite.
The England international was always keen to play a part in United's attacks, but when the time came, he lacked an end product.
One example was in the first half when he and Wayne Rooney led a two-on-one counter attack.
Rather than passing to his teammate, he tried to take on the one City defender and promptly lost possession.
Wayne Rooney: 6
Despite being substituted late in the second half, Wayne Rooney looked like one of the Red Devils' more potent threats for much of the game.
His battle with Yaya Toure was a close fought one before fatigue got the better of the previously injured forward.
Worryingly for the team, his lack of chemistry with Robin van Persie is beginning to really affect both players' form.
Ashley Young: 5
Unless Ashley Young develops a left foot or improves his dribbling ability, he will never be a player with enough quality to consistently lineup for the Red Devils.
Against City, his toil without success defined his team's game. Too often he cut back onto his right foot and delivered a non-threatening cross that was easily dealt with by either Vincent Kompany or Matija Nastasic.
Robin van Persie: 6
The Dutch hitman looked out of sorts during the first half, struggling to create enough space to strike a shot at Joe Hart's goal.
His free kick that led to the Red Devils' equalizer was a peach though, and hinted that he may be close to turning the corner in terms of form.
Antonio Valencia, Javier Hernandez, Shinji Kagawa: N/A
It took Sir Alex Ferguson 80 minutes before he made his first substitution—by then, Manchester City had already struck the decisive blow.
One never feels comfortable criticising the Scotsman, but against Real Madrid and now City, his failure to act in time has perhaps cost his team.
Who impressed you the most for Manchester United? Who was particularly disappointing?
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