Bayern, four-time winners of Europe's top club competition, won their Group A opener at Villarreal 2-0 and host City on Tuesday in what is only the English club's second appearance in the Champions League.
"No team is unbeatable and neither is Bayern," Dzeko, who won the Germany league title with VfL Wolfsburg in 2009, told reporters.
"They are playing very well, nine games and no goals conceded, obviously that's superb but we are also good and tomorrow it will be a very interesting game, especially for the fans."
City drew their first Group A match against Napoli and while Dzeko said they could afford another draw, the team are determined to score their maiden Champions League victory and leave their mark on the competition early on.
"That's [why I joined City]. It is not always about money. It is to play against teams like Bayern Munich, one of the best teams in the world," said the Bosnia international.
"I don't think we have to win tomorrow but we want to win. That is our target."
City coach Roberto Mancini echoed his striker's words, saying their debut at home to Napoli was affected by a case of nerves but that such a showing would not be repeated in Munich.
"I think we wanted to win [against Napoli]. In that game we wanted to win and sometimes this pressure can make you do some mistakes," the Italian said.
"We have a lot of respect for Bayern because we know they are a part of football history. But we are here because we want to do a good job tomorrow."
"This game, it is important to win it if we want to improve. We are not here to lose the game, we are here to win if it is possible but we know it will be difficult."
Mancini said 10 points should be enough to see Manchester City through to the next stage of the competition.
"This is the second game for us in the Champions League. If we want to arrive to the top like Bayern then we need to work very hard. We have six games and we need to make 10 points."
The coach will decide on his strike force just before the game.
"I have four fantastic strikers but it is impossible to play with all strikers. Carlos [Tevez] has a chance but I will decide on the squad tomorrow. But I am sure I can choose well because I have Carlos, Edin, and [Sergio] Aguero," he added.
