City cut the gap to six points with a commanding 3-0 win over Chelsea on Sunday, responding strongly after Arsenal's surprise defeat to Bournemouth a day earlier. With a game in hand and a crucial meeting at the Etihad Stadium on April 19, the title race has shifted firmly into City's control.
Second-half goals from Nico O'Reilly, Marc Guehi and Jeremy Doku sealed the win, underlining City's strong late-season form.
Despite that momentum, Guardiola made it clear his side would not underestimate their rivals.
"The respect I have for Arsenal is huge," he said. "What they have done in recent years, the manager, the players, the quality - they compete in every situation. That's our biggest challenge."
He added: "They have been the best team in this country and in Europe so far. Beating them once is difficult, imagine doing it twice in a few weeks. We have to be ready."
Guardiola also called on supporters to play their part. "I say to our fans: respect Arsenal. Come from minute one and support us because the players will give everything."
City's manager revealed his players had used the "underdog" tag as motivation in their recent League Cup final win over Arsenal.
"In that final, nobody believed we would be better," he said. "Not one person would bet one pound on us. That feeling helped us."
The stakes for the upcoming clash are clear. "It's important to win because we are six points behind," Guardiola said. "If they beat us, it's over. Even a draw is not ideal."
City's record in the final stretch of recent seasons remains formidable, with just one defeat in their last 43 matches across the final 10 games of the last five campaigns. They have also lost only once in their last 19 league matches this season.
Guardiola pointed to improved freshness after their exit from European competition. "We are growing. We have long weeks, more time to train. Everyone knows exactly what to do," he said.
A key figure in that rise has been Rayan Cherki, who continues to impress in his debut season. The French playmaker provided two assists in the win and now has 10 in the league.
"Rayan is an extraordinary talent," Guardiola said. "For his first season, his impact has been incredible. He wants to improve even more, and that is good for him and for City."
Paris Saint-Germain etched their name deeper into European football history on Saturday, defeating Arsenal 4-3 in a dramatic penalty shootout to retain the UEFA Champions League crown in Budapest.
Liverpool FC have confirmed that Arne Slot has left his role as head coach with immediate effect, with the club now beginning the process of appointing a successor.
Raheem Sterling has been arrested following a motorway incident after his Lamborghini collided with barriers on the M3, adding to a difficult period for the former England forward.
Joshua Kimmich has declared that he will be backing Arsenal in the Champions League final against Paris Saint-Germain, after his own side, Bayern Munich, were eliminated by PSG in the semi-finals.
