The Reds had been crowned winners for the first time in 30 years following their win over Crystal Palace and Manchester City's subsequent loss at Chelsea, but Pep Guardiola's charges came out all guns blazing to humiliate the side that claimed the league with a record seven games to spare.
After a spell of promising passages of play, the hosts finally broke the deadlock through a Kevin de Bruyne penalty. The Belgian, a metronome in Manchester City's midfield, made no mistake from the spot as he slotted his 11th goal of the season.
The first goal came off the back of some tricky footwork from Raheem Sterling, to which Joe Gomez had no answers. The latter only managed to pull him down, giving the referee no choice but to point to the spot.
It was a significant moment in the game, especially because the two Englishmen endured a face-off against each other the last time these two sides met.
Sterling would go on to score his goal as well, leaving his compatriot reeling. Gomez had an absolute horror show on the pitch, as he was unable to track City's quick movement or wake up to the running that was happening beyond him.
The third goal was characteristic of what Manchester City have been about under Guardiola. In what was a brilliant, quick interchange between De Bruyne, Gundogan and Foden, the latter showed all the composure in the world to score his side's third.
It was a sensational spell of progressive possession for the Cityzens, but Liverpool only had themselves to blame for being on their heels. Meanwhile, Andy Robertson left too much space in behind him, that in turn allowed Foden to get right through on goal.
It was a very well-taken goal, but credit goes to the awareness and urgency presented by none other than Kevin de Bruyne. It almost seems like he knows exactly where to be, and what to do from that position.
Liverpool tried to inspire something by keeping possession, but their opponents were far too good on the day. Further chances fell to de Bruyne and Foden, before substitute Riyad Mahrez dispossessed Trent Alexander-Arnold to initiate a counter that ended up as an own goal.
It was, however, enough to make matters worse for the visitors, who were simply outplayed by City.
Their full-backs, often heralded for their dynamic presence and crossing abilities, were caught off-guard and punished severely. To double their worries, Manchester City's eye-catching football made it look all the more easy.
Manchester City displayed their desire to bounce back after the defeat to Chelsea, as they always have after dropping points. They have now won three consecutive home games in the league against Liverpool for the first time since 1937.
Liverpool have the title and the honours, but Klopp will certainly feel disappointed after a thrashing of this degree. As for Guardiola's side, they still have a chance to win the Champions League and of course, the FA Cup.