Skipper Kompany trained with the squad this morning but is not yet ready for competitive action.
Elsewhere there was a clean bill of health for the City squad ahead of the second leg, with the tie poised at 2-2 following last week’s dramatic draw in Paris.
Pellegrini said: “Sterling is still injured, and Vincent Kompany is not 100 per cent, it will not be possible for him.
“I’m confident, we have played a lot of games and if we have arrived at this stage of the quarter-finals, it’s because we have good defenders.
“I don’t think either team are favourites - we know we have to play a tough game against a tough team. But we went there to try and win the game and tomorrow we’ll do exactly the same.
“Otamendi twisted his ankle in the last game (against West Brom), he will be okay to play.
“The most important aspect of this team is to score. The team is prepared to play, if we think we need to draw 0-0... that’s not the way we normally play.”
Although City don’t have skipper Kompany to call on, Pellegrini does have David Silva, Yaya Toure and Kevin De Bruyne to call on after they recovered from their respective injury struggles, plus of course star striker Sergio Aguero.
With those players in the side City should be more than confident of squaring up to high profile stars such as Zlatan Ibrahimovic and Angel Di Maria.
“All four are dangerous in attack, but we must have good defending and good attacking. We must be a strong team because we play a good team,” Pellegrini reflected.
“We played the first leg against dangerous players, not only those Ibrahimovic and Di Maria, but it’s difficult to stop Aguero, Silva etc as well. It’s two good teams with good players.”
French right back Bacary Sagna, who will be pushing for a recall to the starting XI after he sat out the win over West Brom, says City must not be distracted by PSG’s big names and focus on themselves.
Sagna said: “We are confident and we can qualify but we need a good performance.
“PSG are a strong team, they have been champions for a few weeks. They have quality players and can be dangerous, but we must focus on our team.”
He added: “We have never reached the quarters before, and we have a chance to reach the semis, which is important for the Club.
“We still have a lot to do and 90 more minutes to play.”