Spain playmaker Santi Cazorla scored second-half goals in a five-minute span for Arsenal in a 2-0 victory over lowly Fulham that keeps the Gunners in the lead by a point.
"We have played 22 games and have 51 points. If you compare that to any other season you will see that it is one of the best, if not the best ever," Arsenal manager Arsene Wenger said after his side's fifth straight league win. "So let's just continue."
City put on another attacking clinic to breeze past Cardiff 4-2 and pass the 100-goal mark this season in all competitions — after just 34 matches. Edin Dzeko, Jesus Navas, Yaya Toure and Sergio Aguero netted for City, which has now scored four or more goals in a game on 12 occasions this campaign.
"It's not easy to score 103 goals by the middle of the season," City manager Manuel Pellegrini said. "It reflects how we think this team must play. We are always an attractive team."
The Chelsea side of last season had been the previous fastest to reach a century of goals in the Premier League era, after 42 games, but Pellegrini's entertainers have set a high bar.
The defeat dumped Cardiff into last place and ensured a miserable return to Manchester for its coach Ole Gunnar Solskjaer, who spent 11 successful years across the city at United.
Third-place Chelsea will look to stay a point behind City by beating Manchester United at home on Sunday in the standout game of the weekend.
Liverpool lost ground in fourth by drawing 2-2 at home to Aston Villa, which raced into a two-goal lead after 36 minutes thanks to strikes by Andreas Weimann and Christian Benteke.
Daniel Sturridge and Steven Gerrard — from the penalty spot — salvaged a draw for Liverpool, which is now eight points behind Arsenal after spending Christmas Day on top of the table.
The scrap for survival is even tighter than the battle for first place, with three teams now locked on 18 points in the relegation zone.
Crystal Palace started the day in last place but Jason Puncheon made up for his awful penalty miss against Tottenham last week by converting from the spot against Stoke, sealing a 1-0 win.
Sunderland remains second from bottom after coming from two goals down to draw 2-2 with Southampton and West Ham makes up the bottom three following a 3-1 loss to Newcastle, for whom France midfielder Yohan Cabaye scored twice while compatriot Loic Remy netted the other.
Norwich climbed five points clear of the drop zone thanks to a 1-0 win over Hull, secured by Ryan Bennett's 87th-minute goal.
Although Arsenal is maintaining the remarkable consistency it enjoyed in 2013, it will be difficult to stop City on current form.
Solskjaer was part of a string of wonderfully attacking teams during his time at Old Trafford, but none of them were as rampant as City's class of 2013-14.
Edin Dzeko brought up City's century of goals with a scruffy opener that dribbled just over the line in the 14th minute at Etihad Stadium, with the validity of the strike confirmed by the Goal Decision System on the giant screens in the corner of the ground.
Craig Noone equalized for Cardiff in the 29th minute but Jesus Navas restored City's lead three minutes later and second-half goals by Yaya Toure and substitute Sergio Aguero kept up the team's 100 per cent home record in the league.
"We are playing fantastic football at the moment," Pellegrini said. "We play with fantastic intensity and that is how we must continue. The best way to play is the way we are playing now."
With Theo Walcott out for the rest of the season with a knee problem and Aaron Ramsey still not fully recovered from injury, it was Cazorla's turn to chip in with goals from midfield to ease the burden on chief striker Olivier Giroud.
Cazorla delivered instinctive finishes in the 57th and 62nd minutes, the first to complete a flowing move and the second after latching onto a clearance to break down the stubborn resistance of a Fulham side that arrived at Emirates Stadium with the league's leakiest defence.
"He is one of the players who can create something special, either through his pass or through his finishing," Wenger said of Cazorla.