The Premier League champions, currently sitting bottom of Group D, have to beat La Liga's and then see Borussia Dortmund beat Ajax in Amsterdam to give them the best chance of finishing in the top two after the final round of games in December.
Real could do with a win, too. After picking up just one point from their double-header with Dortmund, Jose Mourinho's side has not had things all its own way. Defeat at the Etihad Stadium, or even a draw, could leave them sweating on their fate come their last group game at home to Ajax.
The last time these two sides met was also the first.
In their opening fixture of the campaign at the Estadio Santiago Bernabeu, City withstood a barrage of attacks before twice taking the lead in the final quarter of the match.
Edin Dzeko and Aleksandar Kolarov's goals were cancelled out by strikes from Marcelo and Karim Benzema before Cristiano Ronaldo scored an injury time winner with Real's 17th shot on target of the match.
However, that was not the first time City boss Roberto Mancini had faced Real coach Jose Mourinho on the sidelines.
Back in 2003, Mancini's Lazio took on Mourinho's Porto in the semifinals of the UEFA Cup. Claudio Lopez scored early on for the Italian side in the first leg at the Estadio do Dragao only for Maniche, Derlei (twice) and Helder Postiga to see the Portuguese side take a convincing 4-1 win into the second leg in Rome. Mourinho's boys claimed a 0-0 draw at the Stadio Olimpico and went on to beat Celtic in the final.
Mancini lifted Lazio the following year to take over at Inter Milan. When he was sacked in 2008, his replacement was Mourinho, who would claim the Champions League as part of a treble for Inter in 2010.
City left Maine Road and moved into their current home, the Etihad Stadium, in 2003. The same year precocious young winger Cristiano Ronaldo joined local rivals Manchester United from Sporting Lisbon for around £13 million.
The ground then known as the City of Manchester Stadium was rarely a happy hunting ground for Ronaldo and company during his time at the club, even before the huge investment into City by Thaksin Shinawatra and, later, Sheikh Mansour.
In his five Manchester derbies on City turf (he missed the 1-0 defeat in August 2007), Ronaldo won three matches and lost two.
The Portuguese only scored once in those games—the only goal of the game from the penalty spot in May 2007—but he was sent off in two of those fixtures, including his last participation in one before leaving for Real Madrid in 2009.
City know they will be up against a player who is even better than he was during his World Player of the Year-winning era of 2008—at the Bernabeu back in September, he had seven of Real's 17 shots on target—and cannot afford to take his inferior scoring record on their home ground lightly.
It is absurd to think that the pressure is on Roberto Mancini just six months after landing Manchester City their first league title in 44 years. But such is the way of the modern game, especially when you have an employer who has bankrolled your club to the tune of around £1 billion.
With a second successive failure in Europe staring him in the face, even topping the Premier League as the competition's only unbeaten side has not stopped speculation about the surety of Mancini's position among media and fans alike.
The recent appointment of former Barcelona sporting director Txiki Begiristain at City has only served to fuel the speculation further, with some interpreting the move as paving the way for Pep Guardiola to come in and replace the Italian in the summer.
Mancini has the squad, the nous and the experience to retain the Premier League title, but if miraculous circumstances do not transpire to somehow see City through to the later stages of the Champions League, he may not get that opportunity.
"It is my opinion that Real Madrid is the best team in the world with Barca, and when you play against Real, you play against 11 top players."
The most important thing is that the great Real Madrid of last season are back. We did a lot of very nice things, above all in our movement all around the pitch. On Saturday, in the shower, just after the Athletic game, we were already thinking about City.
I think it is only right if Cristiano Ronaldo does believe he is the best in the world. Any guy who gets 37-40 goals a season has a right to believe that, but if you push me I am always going to go on the side of Messi.
Each one of these players has too much quality for us to concentrate on just one of them. Each has enormous quality and can decide a match. It does not matter who plays, we will have to be very alert to try to control them. They are amongst the best in the world.
The Bernabeu game was a blow as we were 2-1 up with the game almost finished. If we had won we would have gained a different mentality. We have a team to do well in Europe. Two years ago we were fighting for fourth place. Since then we have won three trophies and now people are asking us to win the Champions League.
(All quotes via ESPN FC)
City may be top of the league and unbeaten, but they have so far kept just three cleans heats from their 16 games on the league and in Europe so far this season.
Those shutouts—which all came at home—were against Swansea City, Sunderland and Aston Villa. The latter of those two have scored just 10 league goals so far this term, so keeping them out is hardly a ringing endorsement.
They are, however, one of the highest scorers in the Premier League, with only title rivals Manchester United scoring more than their 25 league goals thus far.
Scoring goals is something Real know all about. Their 5-1 defeat of Athletic Bilbao at the weekend means they have scored 16 goals in their last four games in La Liga, while Ronaldo was the top scorer in the Champions League going into this round of fixtures with five to his name.
With City needing to go all out for the win, this game seems destined to be another high-scoring affair just like their first meeting at the Bernabeu.
Ultimately, City's defensive frailties could cost them once again, especially if Real can exploit their opponent's much-documented weakness at set pieces.