City needed two goals in injury time to come back to beat Queens Park Rangers 3-2 and claim a first title for 44 years.
Manchester United won 1-0 at Sunderland to finish level on points but behind on goal difference.
Edin Dzeko and Sergio Aguero were City’s heroes, finding the target in added time to kick-start the celebrations at Eastlands.
“To win like this is incredible. I have never seen a final like this. After 44 years, I dedicate this to all of our supporters,” said City coach Roberto Mancini.
Arsenal finished third after beating West Bromwich Albion 3-2 while, at the other end of the table, Bolton Wanderers were the final team to be relegated after drawing 2-2 at Stoke City.
City were crowned Premier League champions after an incredible fightback which saw them score twice in injury time to beat QPR 3-2 and seal the title on goal difference.
Their dreams of a first title in 44 years appeared to be in tatters as 10-man Rangers led 2-1 after 90 minutes courtesy of goals from Djibril Cisse and Jamie Mackie following Pablo Zabaleta’s opener.
But as Manchester United prepared to celebrate snatching a 20th league title following their 1-0 win at Sunderland, Dzeko and Aguero struck twice in two minutes to seal the most enthralling title duel in years.
“The last few minutes were incrdible. This is for our supporters, they deserve this,” Mancini added.
“To win like this is incredible. I have never seen a finish like this,
After a nervy start, City took the lead five minutes from half-time through Zabaleta, the Argentinian fullback darting onto a deft through ball from Yaya Toure to shoot high into the net past Rangers keeper Paddy Kenny.
The goal sent relief coursing around Eastlands as City prepared for their championship party.
But Eastlands was stunned into silence shortly after half-time when a blunder by Joleon Lescott let in Cisse who raced clear and thundered an equaliser past Joe Hart.
Even then, the force still seemed to be with City, as QPR captain Joey Barton was sent off in an incident that defied belief.
The fiery midfielder was given his marching orders by referee Mike Dean for a retaliatory elbow on Carlos Tevez following an off-the-ball clash.
As Barton left the pitch, the midfielder then angrily kneed Aguero in the back of the thigh to leave himself facing a lengthy ban.
Yet incredibly instead of ramming home their advantage, City were left shellshocked as 10-man Rangers took a 2-1 lead in the 66th minute, Mackie heading in at the far post after Armand Traore’s swift break from defence.
Amid unbearable tension, City looked set for a traumatic defeat until substitute Dzeko nodded in to equalise in the second of five minutes of injury time.
Then, out of nowhere, Aguero skipped clear of the Rangers defence to spark bedlam at Eastlands with the most dramatic winner imaginable.
QPR’s defeat was not enough to send the Londoners down into the Championship however as their rivals for the last relegation spot Bolton could only draw 2-2 at Stoke.
In the other issues to be settled on Sunday, Arsenal clinched third place with a 3-2 win at West Bromwich Albion while Tottenham sealed fourth place with a 2-0 win over Fulham at White Hart Lane.
MONTH BY MONTH GUIDE OF CITY’S TITLE RUN
Manchester City clinched their first English league title for 44 years with a dramatic 3-2 win over QPR on Sunday.
Here we take a month-by-month look at how the battle for the Premier League title unfolded:
City make a flying start as Roberto Mancini’s side begin their bid to dethrone reigning champions Manchester United with a 4-0 demolition of Swansea City, a 3-2 win at Bolton Wanderers and a majestic 5-1 rout of Tottenham Hotspur at White Hart Lane.
But United finish the month in pole position after wins over West Bromwich Albion and Tottenham and an astonishing 8-2 thrashing of Arsenal.
Easy wins over Wigan Athletic and Everton keep City hot on United’s heels, but their 100 percent record is ended in frustrating fashion as Fulham fight back from 2-0 down to earn a draw at Craven Cottage.
United striker Wayne Rooney’s hat-trick inspires a 5-0 battering of Bolton and Sir Alex Ferguson’s men follow that by cruising to a 3-1 victory against Chelsea.
But their winning run is halted late in the month at Stoke City, who earn a 1-1 draw to leave United holding top spot on goal difference.
Despite the fall-out from Carlos Tevez’s touchline meltdown against Bayern Munich, Mancini’s men show the form of potential champions with big wins over Blackburn Rovers and Aston Villa to take first place after United draw at Liverpool.
Any doubts about City’s title credentials are completely erased as they inflict United’s worst home defeat since February 1955 with an incredible 6-1 triumph, featuring two goals from controversial striker Mario Balotelli, to go five points clear.
Ivory Coast midfielder Yaya Toure makes one of several key contributions to City’s challenge as his late goal earns a hard-fought 3-2 win at QPR and Newcastle United, beaten 3-1 at Eastlands, cannot halt the City bandwagon either.
United come to terms with their 6-1 humiliation in typically gutsy fashion by grinding out 1-0 wins over Sunderland and Swansea, but Demba Ba’s controversial penalty gives 10-man Newcastle a 1-1 draw at Old Trafford to allow City to maintain their five-point lead following a draw at Liverpool.
United end the year in erratic fashion as they crash out of the Champions League, then score 16 goals in four domestic matches, including 5-0 wins over Fulham and Wigan.
But Blackburn ensure a miserable birthday for Ferguson, who watches a 3-2 home defeat by the basement club as he turns 70 on New Year’s Eve.
City also bow out of Europe’s elite club competition and their unbeaten record in the Premier League comes to an end as Frank Lampard’s late penalty gives Chelsea a 2-1 win at Stamford Bridge.
By the time City draw 0-0 at West Brom, they have allowed second-placed United to move level on points heading into the second half of the season.
City stumble at the start of 2012 as Ji Dong-Won’s stoppage-time goal gives Sunderland a 1-0 win on New Year’s Day and Mancini’s side, who are also eliminated from the FA Cup and League Cup by United and Liverpool respectively, slip to a 1-0 loss at Everton on the last day of the month.
The only highlight for City is a dramatic 3-2 win over Spurs, but United cannot quite take advantage as Newcastle thrash them 3-0 before the champions reel off three successive wins to end the month level on points with their local rivals.
Mancini’s men get back on track as Fulham, Aston Villa and Blackburn are beaten without a single goal conceded by Mancini’s defence.
United’s strengths and weaknesses are on display in a thrilling 3-3 draw at Chelsea, which sees Ferguson’s team fall 3-0 down after 50 minutes but rescue a point thanks to Javier Hernandez’s late goal.
A 2-1 win over Liverpool and a last-gasp goal from Ryan Giggs, on his 900th appearance, that clinches a 2-1 victory at Norwich City keep United within two points of City.
City’s away-day blues start to take their toll as a 1-0 defeat at Swansea and a 1-1 draw at Stoke dent their title challenge.
The return of Tevez after his five-month self-imposed exile inspires a 2-1 win over Chelsea, but Sunderland hold on for a 3-3 draw at Eastlands to end City’s 100 percent home league record.
United take advantage of City’s struggles with four consecutive victories, including an impressive 3-1 success at Tottenham, a 5-0 rout of Wolverhampton Wanderers and finally a 1-0 win over Fulham to leave them two points clear of their title rivals with a game in hand.
Mikel Arteta’s late winner and Mario Balotelli’s foolish red card complete a dispiriting day for City as a 1-0 defeat at Arsenal prompts Mancini to concede the title to United, who beat Blackburn and QPR to move eight points clear with six games remaining.
But April 11 proves a pivotal day as United slump to a shock 1-0 defeat at Wigan and City crush West Brom 4-0.
United respond by beating Aston Villa 4-0 but City keep pace as Tevez’s treble fires them to a 6-1 win at Norwich and the momentum shifts back to Mancini’s side as they beat Wolves 2-0 after United concede two late goals in a 4-4 draw with Everton.
City make the most of their unexpected reprieve as Vincent Kompany’s header secures a 1-0 win over United at Eastlands that leaves the hosts top on goal difference.
Yaya Toure puts City within touching distance of the title as the midfielder scores twice in the second half to secure a vital 2-0 win at in-form Newcastle.
United reply with a 2-0 victory over Swansea and beat Sunderland 1-0 on the last day, but City end their long title wait in remarkable fashion with two goals in second-half stoppage time to beat QPR 3-2 and spark wild celebrations at Eastlands.