By Phil McNultyChief football writer at Emirates Stadium
Manchester City's faltering title challenge lies in tatters as Mikel Arteta's late goal left them eight points adrift of Premier League leaders Manchester United.
Arteta's 25-yard shot three minutes from time gave Arsenal a deserved victory and struck a devastating blow to City's hopes of preventing United claiming a 20th crown with only six games left.
And to complete the abject misery for City and manager Roberto Mancini, the volatile Mario Balotelli - fortunate to escape dismissal in the first half for a dreadful challenge on Alex Song - was then sent off for picking up a second yellow card for another needless foul on Bacary Saga.
Title race not over - Mancini
The sight of Mancini gesturing furiously at the ill-disciplined Italian as he appeared in no hurry to leave the action was symbolic of a miserable day when City's hopes of winning the title for the first time since 1967-68 surely disappeared.
Arsenal move back into third place with a win that threatened to elude them after Robin van Persie struck the woodwork twice and Theo Walcott saw a shot touched on to the post by City goalkeeper Joe Hart.
The focus, however, will centre on City's demise and the circumstances involving another demonstration of Balotelli's flawed temperament that will see him suspended for three games with the possibility of further punishment for his challenge on Song, which referee Martin Atkinson did not punish as his view appeared to be obscured.
The body language of City's players at the final whistle hinted at a sense of resignation to their fate - while members of the club's hierarchy watched on from the directors' box.
City knew the extent of their task before kick-off after
United's win against QPR
- and their job was made harder by the early departure of Yaya Toure, who never recovered from a heavy challenge from Song and was replaced by David Pizarro.
And they had a fortunate escape after 17 minutes when Van Persie's goalbound header from Arteta's corner struck Thomas Vermaelen and rebounded on to the bar.
As ever, Balotelli was the centre of attention and angered Arsenal with a studs-up challenge on Song that would surely have brought a red card from referee Atkinson had he been able to get a clear view of the incident.
Balotelli then survived another brush with Sagna before eventually receiving a yellow card as the interval approached for another reckless challenge on the Arsenal defender.
He ended the first half lying prostrate and alone on the turf after taking a knock in the back, but was eventually helped off accompanied by members of City's medical staff and was fit to resume after the break.
City opened with a greater sense of purpose after the restart but it was the woodwork that once again came to their rescue after 62 minutes, Van Persie heading against the post after a moment of clever creation from Song.
And City rode their luck again with 14 minutes left when Hart touched Walcott's shot on to the post, with Vermaelen and Yossi Benayoun somehow unable to complete the job from virtually on the goalline.
Wenger buoyed by tenacious Arsenal
The breakthrough came with three minutes left as Arteta won a battle for possession with Pizarro before beating Hart low and powerfully to his left from 25 yards, leaving Mancini berating his side for the space and time the Spaniard was allowed.
And with grim inevitability, the final significant act of the day was left to Balotelli, who senselessly lunged at Sagna to receive his second card. Even his slow trudge to the tunnel did not pass without incident as he was berated by Mancini for the speed - or lack of it - of his departure.
The credits now appear to be rolling on City's attempts to win the battle for Premier League supremacy in Manchester.
Arsenal manager Arsene Wenger:
"We have been consistent in the last two months and the performance reflects what we have produced in the last 10 games: quality, spirit and determination.
"In the end we got the better of them. The goal came late but we deserved to win. Against a good team like City if you don't score early it is always a test, we gave them very little.
"Every time we are in trouble someone finds something special and the confidence is very high. The job isn't done yet.
"City have a chance still but it will be difficult. If you are eight points behind with six games to go they have to win every game. The closer you get the less likely it is that United will make mistakes.
"[Balotelli] It looked a red card to me, it was a bad tackle."
Full Time The referee blows for the end of the match.
90:00 +4:42 Booking
Booking Pablo Zabaleta is booked.
Effort on goal by Aaron Ramsey from deep inside the penalty area misses to the right of the target.
Free kick awarded for a foul by Laurent Koscielny on Carlos Tevez. Shot comes in from Aleksandar Kolarov from the free kick.
Gareth Barry gives away a free kick for an unfair challenge on Tomas Rosicky. Mikel Arteta takes the direct free kick.
Wojciech Szczesny takes the free kick.
Dismissal Mario Balotelli is sent off by the referee.
Unfair challenge on Bacary Sagna by Mario Balotelli results in a free kick.
Mario Balotelli has an effort at goal from long distance that misses to the right of the goal.
86:01 Goal scored
Goal! - Mikel Arteta - Arsenal 1 - 0 Man City Mikel Arteta finds the net with a brilliant goal from long distance to the bottom right corner of the goal. Arsenal 1-0 Man City.
Substitution Alex Oxlade-Chamberlain replaces Theo Walcott.
Aleksandar Kolarov takes the inswinging corner, save made by Wojciech Szczesny.
Substitution Carlos Tevez comes on in place of Sergio Aguero.
Unfair challenge on Mario Balotelli by Aaron Ramsey results in a free kick. Aleksandar Kolarov crosses the ball from the free kick left-footed from right wing, Wojciech Szczesny makes a comfortable save.
Substitution Aleksandar Kolarov replaces Samir Nasri.
Substitution Aaron Ramsey joins the action as a substitute, replacing Yossi Benayoun.
Theo Walcott takes a shot. Save made by Joe Hart. Yossi Benayoun takes a shot. Blocked by Vincent Kompany. Robin van Persie takes the inswinging corner, Vincent Kompany makes a clearance. Clarindo Andre Santos fouled by James Milner, the ref awards a free kick. Free kick taken by Clarindo Andre Santos.
Theo Walcott takes a shot. Blocked by Joleon Lescott. Short corner worked by Robin van Persie.
Yossi Benayoun takes a shot. Blocked by Vincent Kompany.
The assistant referee flags for offside against Robin van Persie. Joe Hart restarts play with the free kick.
Free kick crossed right-footed by David Pizarro.
Booking Laurent Koscielny goes into the referee's book.
Laurent Koscielny concedes a free kick for a foul on Gareth Barry.
Tomas Rosicky gives away a free kick for an unfair challenge on Gareth Barry. Joe Hart restarts play with the free kick.
Unfair challenge on Gael Clichy by Tomas Rosicky results in a free kick. Gael Clichy takes the direct free kick.
Header from close in by Robin van Persie bounces off the post.
Yossi Benayoun takes a shot. Save made by Joe Hart.
James Milner is ruled offside. Clarindo Andre Santos restarts play with the free kick.
Free kick crossed by James Milner, Laurent Koscielny makes a clearance.
Booking The referee cautions Clarindo Andre Santos for unsporting behaviour.
Free kick awarded for an unfair challenge on Mario Balotelli by Clarindo Andre Santos.
James Milner takes a outswinging corner. Sergio Aguero has an effort at goal from the edge of the area that misses to the right of the target.
Robin van Persie crosses the ball in from the free kick, Vincent Kompany makes a clearance.
Substitution Kieran Gibbs leaves the field to be replaced by Clarindo Andre Santos.
Booking James Milner goes into the book.
James Milner gives away a free kick for an unfair challenge on Tomas Rosicky.
The offside flag is raised against Robin van Persie. Indirect free kick taken by Joe Hart.
Sergio Aguero takes a shot. Save made by Wojciech Szczesny. Corner taken right-footed by James Milner to the near post, Joleon Lescott has a headed effort at goal from close range which goes wide of the left-hand upright.
Free kick awarded for an unfair challenge on Laurent Koscielny by Sergio Aguero. Wojciech Szczesny takes the free kick.
Samir Nasri challenges Mikel Arteta unfairly and gives away a free kick. Free kick taken by Wojciech Szczesny.
Foul by Yossi Benayoun on Pablo Zabaleta, free kick awarded. Free kick taken by Pablo Zabaleta.
The referee gets the second half underway.
45:00 +3:28 Half time
Half Time The first half comes to an end.
Robin van Persie is caught offside. Indirect free kick taken by Joe Hart.
Mario Balotelli handles the ball and concedes a free kick. Wojciech Szczesny restarts play with the free kick.
Yossi Benayoun challenges Gareth Barry unfairly and gives away a free kick. Vincent Kompany takes the direct free kick.
The offside flag is raised against Sergio Aguero. Wojciech Szczesny restarts play with the free kick.
Theo Walcott is penalised for a handball. Joe Hart restarts play with the free kick.
The assistant referee flags for offside against Kieran Gibbs. Free kick taken by Joe Hart.
Inswinging corner taken from the left by-line by James Milner, clearance by Kieran Gibbs.
Robin van Persie concedes a free kick for a foul on Joleon Lescott. Joleon Lescott takes the free kick.
Direct free kick taken by Wojciech Szczesny.
Booking Caution for Mario Balotelli.
Free kick awarded for an unfair challenge on Bacary Sagna by Mario Balotelli.
Gareth Barry gives away a free kick for an unfair challenge on Kieran Gibbs. The free kick is swung in right-footed by Mikel Arteta, save by Joe Hart.
Bacary Sagna gives away a free kick for an unfair challenge on Gael Clichy. Free kick taken by David Pizarro.
Inswinging corner taken left-footed by Gareth Barry from the right by-line, Header by Joleon Lescott from deep inside the penalty area misses to the left of the target.
Sergio Aguero concedes a free kick for a foul on Mikel Arteta. Direct free kick taken by Mikel Arteta.
The referee penalises Pablo Zabaleta for handball. Wojciech Szczesny takes the free kick.
Sergio Aguero is caught offside. Indirect free kick taken by Wojciech Szczesny.
Corner taken left-footed by Gareth Barry, Mario Balotelli takes a shot. Kieran Gibbs gets a block in.
Free kick awarded for an unfair challenge on Alex Song by David Pizarro. Laurent Koscielny takes the direct free kick.
Corner taken by Mikel Arteta, Laurent Koscielny produces a header from inside the six-yard box that clears the bar.
Alex Song concedes a free kick for a foul on Sergio Aguero. Direct free kick taken by David Pizarro.
Substitution Gnegneri Toure Yaya goes off and David Pizarro comes on.
Free kick awarded for a foul by Samir Nasri on Thomas Vermaelen. Laurent Koscielny takes the free kick.
Corner taken right-footed by Mikel Arteta to the near post, Robin van Persie takes a shot. Tomas Rosicky produces a header from inside the area that goes over the crossbar.
The ball is delivered by Theo Walcott, Vincent Kompany manages to make a clearance.
Mario Balotelli challenges Alex Song unfairly and gives away a free kick. Mikel Arteta takes the direct free kick.
Free kick awarded for a foul by Alex Song on Gnegneri Toure Yaya. Joe Hart takes the direct free kick.
Tomas Rosicky takes a shot. Vincent Kompany gets a block in. Corner from left by-line taken by Mikel Arteta.
Bacary Sagna sends in a cross, clearance by Vincent Kompany.
Unfair challenge on Joleon Lescott by Robin van Persie results in a free kick. Gnegneri Toure Yaya takes the direct free kick.
Mario Balotelli is caught offside. Wojciech Szczesny takes the free kick.
Corner from the right by-line taken by Robin van Persie, Joe Hart makes a save.
The referee blows for offside. Free kick taken by Mikel Arteta.
Free kick crossed right-footed by Mikel Arteta from left channel, Vincent Kompany manages to make a clearance. Corner from the left by-line taken by Mikel Arteta, clearance made by Mario Balotelli.
Booking Gnegneri Toure Yaya goes into the book for unsporting behaviour.
Unfair challenge on Tomas Rosicky by Gnegneri Toure Yaya results in a free kick.
Free kick awarded for an unfair challenge on Alex Song by Samir Nasri. Mikel Arteta takes the free kick.
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