Not since 1992-1993, the first year of the Premier League, have United failed to win in their first three league fixtures.
And what a contrast in the fortunes of City, who spent much of last season battling against relegation, as they sit proudly at the top of the table.
A goal from Brazilian Geovanni made it three wins out of three for Sven-Goran Eriksson's City who maintained their 100 per cent record.
And it is City who find themselves heading the table while the Red Devils are languishing in the bottom half of the standings.
With Wayne Rooney injured and Cristiano Ronaldo suspended United lacked a cutting edge, despite enjoying territorial advantage for long periods of the match.
New signing Owen Hargreaves was given his debut as United packed their midfield, with Carlos Tevez their lone frontman.
City, meanwhile, were without the unwell Stephen Ireland, while Valeri Bojinov was preferred up front to Rolando Bianchi.
Eriksson was forced into an early change when Bojinov was injured after only five minutes as he was replaced by Emile Mpenza.
United had the better of the early exchanges as Nani had two decent attempts at goal and the same player might have won a penalty after being clattered from behind by Vedran Corluka.
But it was City who stole the lead in the 32nd minute with a goal made in Brazil as Elano set up Geovanni, who scored with a drive from 25 yards, albeit with the aid of a deflection off defender Nemanja Vidic.
United were desperately unlucky not to draw level early in the second period when Vidic headed against the crossbar from a corner by Ryan Giggs.
In the final half hour United threw on Chris Eagles, John O'Shea and reserve striker Fraizer Campbell, the latter for his first-team debut, in a bid to salvage at least a point.
Eagles was desperately unlucky to score immediately after coming on when, sliding in at the far post, he narrowly failed to convert Giggs' low cross.
Try as they did, there was no way back for United despite sustained pressure on the City goal.
And it was great credit to City who were strong defensively and withstood the onslaught, with Micah Richards and Richard Dunne outstanding at the heart of their defence.
And at the final whistle former England manager Eriksson was left to savour a sweet victory against Sir Alex Ferguson in his first derby as Citizens boss.