The red half of Manchester won the derby bragging rights as goals from Marcus Rashford and Anthony Martial dealt an enormous blow to Manchester City's Premier League title hopes.
Manchester United sprung a huge surprise after running riot in the first half, with Nicolas Otamendi's 85th-minute header failing to ignite a comeback for the much below-par hosts.
Story of the match
United had made the better start, with Daniel James twice forcing saves out of Ederson, and shortly after the 20-minute mark they were presented with a golden opportunity to go ahead.
Rashford went to ground under challenge as he tried to weave into the penalty area through the Manchester City challenges, and although referee Anthony Taylor did not initially point to the spot, he was instructed to do so after VAR review, with Bernardo Silva adjudged to have pushed the forward to the floor.
After a brief stutter in the run-up, Rashford sidefooted the ball into the bottom right corner, sending Ederson the wrong way.
Rashford would have two fantastic chances to double his side's lead within the next five minutes.
His first-time effort at the end of a sweeping counter-attack bounced past the post, and then he bent the ball onto the crossbar following Martial's cut-back to the edge of the box.
Soon, though, the intense pressure told. Martial turned Rodri, exchanged a one-two with James and was able, in a tight scenario, to precisely fire it into the bottom corner beyond Ederson's outstretched glove, leaving the Etihad stunned.
There was more drama in the closing stages of the first half, City denied a penalty of their own after Kyle Walker's cross from the byline struck the arm of sliding Fred.
A City onslaught would have been expected in the second half, but aside from a last-ditch Victor Lindelof block from Kevin de Bruyne and a powerful Rodri effort which David de Gea acrobatically saved, there were relatively few heart-in-mouth moments for the visitors.
But the champions set-up a grandstand finish when two substitutes combined, Otamendi powerfully heading Riyad Mahrez's corner home.
The best chance to equalise in the short time that remained fell to Mahrez, but De Gea got down to palm away his side-footed shot across goal.
After the match, City confirmed that they were seeking to identify an individual after a video surfaced on social media 'which appears to show a supporter making racial gestures during the second half'.
They reiterated that anybody found guilty of racial abuse would be banned from attending the stadium for life.
An investigation has also been launched into 'regarding an instance of objects being thrown onto the field of play' when United were preparing to take a corner.
Takeaways
Solskjaer's biggest result
Many have questioned Ole Gunnar Solskjaer's credentials but on the evidence of this monumental display and their other big-game performances, the dressing room is wholly behind him.
United are not blessed with the quality of yesteryear but the spirit remains. Here they played for the badge, and they seemed to want it more than their city rivals.
The Red Devils have now faced every other 'big six' club this season and on each occasion, they have emerged unbeaten. In fact, they have predominantly run out victorious. With so much pace, and an increasing ruthlessness, up-front, they are very well-suited to the counter-attacking style they adopt in these games.
Rashford and Martial were the heroes here, but it should be noted that the victory was founded on a tireless defensive display, spearheaded by Aaron Wan-Bissaka.
City need monumental turnaround to avoid being dethroned
Last season, Manchester City edged Liverpool by a single point, with both sides near-faultless. Now that they find themselves 14 points behind the Jurgen Klopp juggernaut, many will claim that their hopes of a third consecutive crown have realistically been extinguished.
There are too many fixtures remaining for that to be the case, but something is wrong at City at the moment and it extends beyond their meek defence. The air of near-invincibility, and the unwavering self-belief which characterised the squad, have seemingly been dismantled.
Across the whole of 2018/19, they dropped only 16 points. Today they eclipsed that tally.
There could soon be clear daylight between themselves and Leicester City.