A 14th straight victory for City is a record run in a single top-flight season while Liverpool were off the mark as Wayne Roney equalised for Everton.
The race for the Premier League title is turning into a procession after City beat fierce rival Manchester United 2-1 on Sunday, extending its lead to 11 points in a record-breaking start to the season.
This 14th straight victory for City is a record run in a single top-flight season. No team has ever had this many points — 46 — after 16 games in the Premier League. To put City's form into context, 46 points would have secured eighth place in the league last season.
It's only early December.
Pep Guardiola's team is doing it in style, too. Having already beaten Liverpool 5-0 and overwhelmed Chelsea in a 1-0 win at Stamford Bridge, City came to Old Trafford to play the other member of the current top four and had 65 percent possession and almost twice the number of shots.
For most of the first half and in the final stages of the second half, United was overrun in a stadium where it hadn't lost in any competition since September 2016 — against City, 41 home games ago.
Given its eye-catching style of play, the irony was that City's two goals couldn't have been scrappier. Both came from defensive mistakes from United striker Romelu Lukaku at set pieces, with David Silva (in the 43rd) and Nicolas Otamendi (in the 54th) the gleeful recipients with close-range finishes.
Marcus Rashford equalised in first-half injury time, also benefiting from a defensive mistake from Otamendi, and United manager Jose Mourinho was left to bemoan the failure of Michael Oliver to award a penalty for what he thought was a trip by Otamendi on Ander Herrera. Instead, Herrera was booked for simulation.
"We can speak about anything you want," Mourinho said, "bring any football theory, bring any stats, ball possession, you can bring anything you want. But like last season, there is a huge penalty (not awarded) in a crucial moment of the game."
Guardiola, unsurprisingly, saw it differently.
"We won," Guardiola said, "because we were better."
And in a nod to his critics, Guardiola added: "I am happy because so many people say you cannot win in England playing like this."
In the other neighborly rivalry on derby day in the Premier League, Wayne Rooney converted a penalty to earn Everton a 1-1 draw at Merseyside rival Liverpool. Arsenal scored in the 88th minute to salvage a 1-1 draw at Southampton in the day's other game.
Both fourth-place Liverpool and fifth-place Arsenal can only realistically think about second place now, which says a lot considering the Premier League hasn't even reached the busy festive period yet.
That is the standard being set by City.
Set pieces were supposed to be United's strength and City's weakness. So even Guardiola accepted the peculiarity of City's goals coming from that route.
For Silva's opener, Lukaku was tussling with Otamendi at a corner and only succeeded in deflecting Kevin De Bruyne's inswinging delivery right into the path of Silva to dispatch from inside the six-yard box.
Rashford equalised after Otamendi failed to deal with Marcos Rojo's long ball forward and ended up flicking a header into the path of the United striker.
Otamendi made amends — but again Lukaku was at fault. His attempted clearance from Silva's free kick struck the back of teammate Chris Smalling and fell to Otamendi, who slammed the loose ball home.
City was grateful to goalkeeper Ederson Moraes for producing a brilliant double save, off Lukaku then Juan Mata, in the 84th minute to preserve its lead and win 2-1 at Old Trafford in the league for a second straight season.
An innocuous push by Dejan Lovren cost Liverpool dear in a Merseyside derby that it had dominated.
The center back gave Dominic Calvert-Lewin a nudge in the back when Everton's striker was heading away from goal and Rooney converted the penalty after lots of complaints from Liverpool's players.
Liverpool took the lead through Mohamed Salah's league-high 13th goal of the season and had chances to wrap up the win before Lovren's mistake.
Everton still hasn't won at Anfield since 1999, but remained unbeaten in three matches under new manager Sam Allardyce.
Olivier Giroud made the difference off the bench again for Arsenal.
The France striker scored an 88th-minute equalizer for his 17th goal as a substitute in the Premier League. That matches a record he holds with former Manchester United striker Ole Gunnar Solskjaer.
Giroud, on as a 72nd-minute replacement, glanced home Alexis Sanchez's left-wing cross as Arsenal's late pressure told at St. Mary's Stadium. Charlie Austin gave Southampton the lead in the third minute.