The champions trail their visitors by four points after 17 games of the season, while both teams will be looking to take the opportunity to close the gap on runaway leaders Liverpool.
While this fixture always looked like a tasty way to head into Christmas for both sides, at the start of the season few would have expected it to have the significance it does now.
Man City know that even a victory would not be enough to leapfrog Leicester in the table, and that victory is by no means guaranteed considering how impressive Brendan Rodgers's side have been.
The Foxes have won more games, lost half as many and conceded eight fewer goals than Saturday's hosts so far this season, while they also boast the division's best goal difference ahead of even Liverpool.
Pep Guardiola's side will still go into the match as favourites, particularly having steadied the ship with three successive wins since their derby defeat to Manchester United, but there are plenty of warning signs for the champions.
Perhaps the main one is that their four defeats this season have all come against teams who punished them with pace on the counter-attack, something Leicester and Premier League top-scorer Jamie Vardy are perfectly equipped to do too.
Even League One outfit Oxford United caused them problems in the quarter-finals of the EFL Cup on Wednesday night, registering more shots on target than Man City and ending up on the end of a 3-1 defeat which flattered the holders.
City's reward for that victory is a Manchester derby semi-final, giving them an opportunity to avenge the 2-1 defeat to their local rivals in what was their last home game.
A final against Leicester could be on the cards, but first Man City must overcome the Foxes in the league if they are to avoid back-to-back top-flight home defeats for the first time since February 2016 and claim successive league wins for the first time since the start of November.
Last weekend's Kevin De Bruyne-inspired win over Arsenal provided Man City with their only clean sheet in their last 12 outings across all competitions, but they have not kept one in front of their own fans since October while Leicester have scored in each of their last 15 games.
Guardiola's side have already dropped as many points as they did throughout the whole of last season and know that they cannot afford any more slip-ups if they retain hope of catching Liverpool in the title race, making Saturday's showdown a must-win contest for them.
Man City's first task is catching Leicester, of course, but for both teams this match represents a rare opportunity to close the gap on Liverpool with Jurgen Klopp's side currently away at the Club World Cup.
A win for Leicester would reduce their deficit back down to seven points and also set them up perfectly for their huge Boxing Day clash with the league leaders, who are becoming increasingly affected by injury problems through their busy December schedule.
It could be that the Foxes are only four points adrift by the time they play their final match of the year against West Ham United next weekend, then, although to do so would mean back-to-back wins over last season's top two in a Christmas double-header which is just about as hard as they could wish for.
Regardless of what does happen in those two games, 2019 has been a great year for Leicester, who at this stage last season sat 12th with 22 points and 21 goals under the unpopular Claude Puel.
Fast-forward a year and the Foxes are 10 places, 17 points and 19 goals better off while playing the type of football the fans were desperate to see, leading to Rodgers already signing a new long-term contract with the club.
Indeed, Rodgers has been so impressive that he has been linked with the Man City post should Guardiola leave at the end of the season, and a victory at the Etihad - where the hosts have already lost twice this season - would do his chances of landing that job no harm at all.
Leicester have every reason to be confident of picking up the victory too, having won a club-record eight league games in a row prior to last weekend's disappointing draw at home to Norwich City.
Progress in the EFL Cup on Wednesday night got them back to winning ways, albeit via a penalty shootout after letting a two-goal lead slip against Everton, meaning that they have now won 16 of their last 19 games across all competitions.
Leicester's away winning streak remains intact too, now six in a row across all competitions, although their only two league defeats this season have come on the road at Manchester United and Liverpool.
Even so, the Foxes have picked up as many away points this season as Man City have at home, so the visitors will be confident of more than holding their own on Saturday.
Man City Premier League form: LWDWLW
Man City form (all competitions): DWLWWW
Leicester Premier League form: WWWWWD
Leicester form (all competitions): WWWWDW
Sergio Aguero is also pushing to be ready for this match, although the Argentine is considered a much bigger doubt and may have to settle for the visit to Wolverhampton Wanderers after Christmas.
Leicester only have one injury concern with Matty James still out, although Rodgers named a strong team for their EFL Cup quarter-final in midweek.
Caglar Soyuncu and Youri Tielemans were two first-team players given a rest and both are expected to return to the starting lineup, while Harvey Barnes will be hopeful of a recall with Leicester unlikely to go for two up front away to Man City.
Vardy, who thought he had scored in a ninth league game in a row last weekend only to see it chalked up as an own goal instead, will be looking to improve his league-best tally of 16 goals this season.
Man City possible starting lineup:
Ederson; Walker, Otamendi, Fernandinho, Mendy; De Bruyne, Rodri, D Silva; Bernardo, Jesus, Sterling
Leicester possible starting lineup:
Schmeichel; Pereira, Soyuncu, Evans, Chilwell; Perez, Tielemans, Ndidi, Maddison, Barnes; Vardy
Head To Head
This fixture provided one of the most memorable moments of last season when Vincent Kompany unleashed a 30-yard rocket into the top corner to hand Man City a 1-0 win which proved pivotal to them pipping Liverpool to the title.
Leicester did win the reverse fixture at the King Power Stadium, though, and won at the Etihad as recently as 2016, when now-Man City player Riyad Mahrez was among the scorers for the Foxes en route to the title.
Man City have won six of the last seven meetings across all competitions, though, and boast a far superior head-to-head record over the entire history of the fixture with 59 wins compared to 30 for Leicester.
We say: Man City 2-1 Leicester
Leicester have been excellent so far this season and it would not be a huge surprise to see them get something from this game, particularly given how much Man City have struggled with pace on the counter-attack at times this season. The uncertainty surrounding Mikel Arteta's impending move to Arsenal could also affect the hosts.
However, we are backing Man City to come out on top by a very narrow margin nonetheless. Guardiola's side still possess some of the league's very best players, and if De Bruyne in particular reaches the levels he showcased last weekend then there is not much Leicester will be able to do.