With two matches to play, both Manchester clubs are on 83 points but City lead on goal difference.
Roberto Mancini's City have scored 88 goals and conceded 27 for a goal difference of 61 while United have scored 86 goals and conceded 33 for a difference of 53.
Not since Arsenal and Liverpool finished level on points in 1989 has the title race been so close when the teams finished level on points (76) and goal difference (37).
Arsenal's Michael Thomas scored with almost the last kick of the final game of the season to give his side a 2-0 win at Liverpool that clinched the title by virtue of Arsenal having scored more goals over the season.
Such neck-and-neck finishes are rare.
Prior to 1989 the last time it happened was 1965 when Manchester United and Leeds United finished level on points and Manchester took the title under a system that separated the sides on average goals scored over the 42 games of the season.
On paper, Manchester City have the harder games left this season and that makes United favourites to win the title, according to City manager Roberto Mancini.
City's last two matches are at Newcastle United, who are chasing a Champions League place, and home to relegation-threatened Queens Park Rangers.
United, meanwhile, will host Swansea City and travel to Sunderland, both opponents safe in mid-table.
'WORST NIGHTMARE'
Gary Neville, who retired as a United player last season, told Sky Sports that losing the title on goal difference was manager Sir Alex Ferguson's "worst nightmare".
"Losing a championship on goal difference is what he always talks about, every single season," said Neville.
"In January, in February, in March, whatever month it is, going for a championship he will say: 'If you're 1-0, 2-0 up, score three, score four'.
"You never know whether it's going to get to goal difference."
Neville said United had passed up opportunities to boost their goal difference during the season.
"Look at games like Fulham at home 1-0, QPR at home 2-0, and it's these sort of things you look back at during a season an think, 'we could we have done more'.
"It is his worst nightmare."
As events unfolded on Monday, Ferguson probably thought he was in the midst of a bad dream and lost his temper with Mancini at one point as the pressure boiled over on the touchline in the second half.
Ferguson told ESPN he thought Mancini had been "badgering officials" during the match.
The United manager was also frustrated after his defensive 4-5-1 system made little headway against City and hardly created a chance in the game.
The only goal came when City skipper Vincent Kompany headed home from a corner just before halftime and completed a league double over United this season following a 6-1 win in October.
