The Reds, who were smothered and on the ropes for much of the first half, sealed their qualification to the semi-final with two second half goals from Roberto Firmino and Mohamed Salah, canceling out Gabriel Jesus' second-minute opener for the hosts.
After failing to beat Manchester United in the derby over the weekend to seal the Premier League trophy, suddenly City fans are beginning to scratch their heads after three consecutive defeats.
Early strike from Jesus
In a match that City knew they would need at least three goals to have a chance in the tie, the hosts did not take long to get their first. Virgil Van Dijk’s miss-pass in the second minute gave City the ball in prime position, where Raheem Sterling was played into a two-on-one situation. Sterling laid the ball off to Gabriel Jesus, who’s strike gave the Citizens a reason to believe.
The first half pace was a marvel to behold, with Manchester City pressuring the Liverpool defense for almost the entire 45 minutes and with multiple good chances to score.
Controversial offside call
The Citizens had two great chances to get their second in the 41st and 42nd minutes. Bernardo Silva’s curler beat Loris Karious but hit the post, while City had a goal incorrectly ruled out for offside a minute later when Leroy Sane’s tap in appeared to give City a 2-0 advantage.
While the ball appeared initially to come of a City player and then Sane, the replay showed that the ball hit Liverpool’s James Milner before reaching Sane, which would mean Sane was actually onside.
The first 45 minutes were also filled with bookings by Spanish referee Antonio Mateu. Mateu dished out five yellow cards in the first half, three to Reds players and two given to City players. Sadio Mane almost had a repeat of his last sending off in the begging of the premier League season when he plowed into Nicolas Otamendi in the 15th minute, but goalkeeper Ederson began to push the Liverpool forward and both Ederson and Mane needed up with yellows.
Manchester City manager Pep Guardiola was sent off to the stands at the conclusion of the first half when the Spanish referee and the Catalan manager were seen in a heated exchange.
Salah drives dagger into City hearts
Liverpool were given a bit more space by City to begin the second half, allowing the Reds to have a bit more possession of the ball and strides into attack.
Salah continued his brilliant debut Liverpool season with a 56th minute away goal for the Reds. The Egyptian was the first to the spot when Ederson mishandled the ball on a Mane chance, and Salah slotted home the ball to give the Reds an enormous away goal. Despite the match being tied 1-1, Salah's goal meant that the hosts had to score four more goals to advance to the semi-finals.
City continued their advantage in possession and attempted to direct more balls towards the box from the flanks, but most of the hosts' chances went untouched or without much harm near the Liverpool goal. Sergio Agüero was brought on to play upfront with Gabriel Jesus, but his appearance would not be enough for the Blues to climb back into the tie.
Liverpool put any chance of a Manchester City miracle to bed when Firmino slotted home the Reds' second goal of the second half. The Brazilian stole the ball from a faltering Otamendi on the left flank before running into space and slotting the ball far post past national teammate Ederson.
With FC Barcelona crashing out in remarkable fashion against AS Romas in the eternal city, Liverpool may well be eyeing a sixth European Cup, ahead of Friday's draw for the last four.