A Tim Cahill header and a clinical finish from Mikel Arteta dented the home side’s top four hopes on a night when nothing went right for the men from Manchester.
Even the normally placid Roberto Mancini lost his cool in an injury time clash with Everton chief David Moyes and both men were sent to the stands by referee Walton.
After a month away from the comforts of home there was no disguising the delight of the Blues players to be back amongst their own as they tore into the Toffees with gusto in an attempt to build on three tough road trips that yielded seven points and re-affirmed the Bookmakers’ faith in City’s ability to clinch the fourth spot.
But nothing fell for them in front of goal and Everton became the first team since Fulham to down the Blues in the Premier League.
On a night that might have seen the Blues leapfrog Spurs, Mancini, who has possibly waved goodbye to both Joleon Lescott and Wayne Bridge for the majority of what remains of the Premier League season, did as he promised after the 3-1 win at Fulham and rang the changes.
In came Stevie Ireland in his preferred position behind the lone striker, Nigel de Jong to protect the back four and right back Micah Richards. Out went Javier Garrido, Patrick Vieira and Roque Santa Cruz all consigned to the bench.
One man assured of his place was 22-goal Carlos Tevez who, before tonight, was something of an omen when it came to taking three points. The Blues had triumphed in the last seven games in which he had scored.
City began the match as the only club with an unbeaten home record this season and had gone 16 league matches without defeat at the City of Manchester Stadium since that Fulham defeat – also by two goals.
Despite a rapid rise up the table, Everton arrived after the short trip from Merseyside having failed to win any of their last three away matches but full of determination of their own to complete a notable double over City.
They packed in their kit bag a great record that illustrates their resilience having picked up 14 points from losing positions this season, only Chelsea (15) have won more points after falling behind this season. It is a mark of a side marbled with grit and so it proved.
The opening half was a lot of huff and puff - quite often on the whistle of referee Peter Walton - who annoyed home fans by booking Tevez for attempting to make a slide tackle with his head and then failed to award a penalty to the Argentine after he appeared to be felled by keeper Tim Howard.
The Northants official was even less popular just past the half hour when he awarded a free kick against Gareth Barry and Tim Cahill converted from a Leighton Baines’ cross to put the visitors into the lead.
Thereafter the half got ill-tempered and Shay Given was booked for protesting that an Everton player wasn’t!
No one was happier to hear the whistle that signified the break than the man who blew it! He left to a cacophony of boos.
City had the lion’s share of the ball in the second half but failed to do much of significance with it.
The final ball was poor and the crossing mediocre while Everton’s tackling remained at fever pitch.
Unfortunately the net result of all that was the quietest of forty-five minutes for Howard who didn’t have a save of note to make.
Neither did Given at the other end but by then the damage had been done and Everton did what they have been terrific at over the years and held on to what they had before applying the coup de grace in the 86th minute when the promising Rodwell’s great work down the right set up Arteta who found the corner of the net with aplomb.
That should have been that but there was still time for a managerial spat and for City fans to reflect that five of the remaining eight matches are at home.