The red half of Manchester finally had reason to celebrate on derby day, with a 4-2 win ending a run of four straight losses to City. Third-place United moved four points clear of its stumbling local rival, whose manager Manuel Pellegrini is facing mounting scrutiny after City's staggering dip in form.
"(The fans) can go on the streets with their hats up and say, 'This year, we are the better team,'" United manager Louis van Gaal said.
City's derby dominance ended on the same day its hold on the Premier League trophy was further loosened by Chelsea's 1-0 win at Queens Park Rangers.
Cesc Fabregas scored an 88th-minute winner with Chelsea's first shot on target, leaving Jose Mourinho's team seven points clear of Arsenal with a game in hand and needing 11 more points to capture a first league title since 2010.
"A team who arrives in August and is top of the league every day until April - that is the team that deserves the credit," said Mourinho, whose side is unbeaten since Jan. 1.
After being level on points with Chelsea on New Year's Day, City could soon be 15 points adrift. Such is the champions' reversal of fortunes that even a top-four finish is under threat, with fifth-place Liverpool able to trim the gap to City to four points by beating Newcastle on Monday.
City has lost four away matches in a row and six of its last eight games in all competitions. No wonder Pellegrini's job is in danger.
"I am not talking about my position. It is not important," said the Chilean coach, who added: "We are not in a good moment. We have a bad 2015 and a very bad week."
United responded to going behind in the eighth minute to Sergio Aguero's goal by scoring twice in 13 minutes through Ashley Young and Marouane Fellaini — two players whose United careers have been revived under Van Gaal.
Juan Mata ran onto Wayne Rooney's through-ball to make it 3-1 in the 67th and Chris Smalling made the most of more poor defending to head home unmarked at a free kick seven minutes later.
United has won six straight games and is starting to show the swagger associated with the Alex Ferguson era.
"The key is the process," Van Gaal said, when asked what had changed from the early part of the season when United struggled. "When the players understand what they are doing on the pitch with conscious, then you can continue much more easily than before.
"Now I think a lot of players do understand what we are doing and what we are willing to perform."
Aguero scored a consolation in the 88th minute for City, whose players look bereft of confidence and spirit.
"Maybe that is something we can be concerned with," Pellegrini said in one of his more telling comments.
Chelsea has won its last three games by a one-goal margin, without playing at its best in any of them.
Fabregas' goal came after a skewed clearance by QPR goalkeeper Robert Green, which was pounced on by Eden Hazard. The Belgium winger exchanged passes with Oscar and cut the ball back for Fabregas to sidefoot home inside the near post.
As he celebrated, Fabregas lifted off the mask he was wearing to protect his broken nose sustained against Stoke last weekend.
"Were we fortunate? Yes," Mourinho said. "It was a typical game for 0-0."
QPR stayed third from bottom after its sixth straight home loss.