The Young Blues dominated the game but Manchester United soaked up heavy pressure before netting twice with their only two meaningful attacks of the game through Hannibal Mejbri and Teden Mengi.
We pulled one back with 15 minutes remaining through Liam Delap and almost equalised after a late push, but United goalkeeper Ondrej Mastny was in fine form to keep us out.
Gareth Taylor’s in-form youngsters started the game in confident fashion, passing the ball around calmly in the opening exchanges.
The first chance of the game fell to us after 12 minutes, with Samuel Edozie latching onto a superb diagonal pass from Lewis Fiorini. The winger cut in and fired his shot towards goal, but it was blocked well by the United defence.
The Young Blues were encouraged by the chance and seven minutes later, we came within inches of taking the lead. Great play on the left wing once again by the tricky Edozie resulted in the ball falling to Alex Robertson just outside the 18-yard box, but his curling effort cannoned back off the post.
Our attacks were relentless and this time it was Josh Wilson-Esbrand who burst forward and drilled a cross into the six-yard box, but United scrambled clear.
Just before the half-hour mark, Fiorini forced United shot-stopper Mastny into his first save of the game. James McAtee delightfully chipped the ball through to Fiorini and his first-time effort was parried to safety.
McAtee himself was next to come close, weaving past a couple of opponents before striking just over the bar from the edge of the box. The attacking midfielder was at the heart of almost every City attack and he was at it again five minutes before the interval. Fiorini won the ball back and slid in McAtee, but his stroked effort was deflected out for a corner.
The visitors hung on until the interval and then caught us napping with their first meaningful attack of the game. Reece Devine found space on the left wing and cut the ball back for Mejbri, who struck into the far corner just one minute after the restart.
The visitors continued to frustrate us with their deep defending, and they absorbed more pressure before hitting on the counter. Anthony Elanga was found inside the box but fortunately, he curled his effort wide.
Just after the hour mark, United doubled their lead. Centre-back Mengi found himself in space inside the box and drilled the ball beyond Gavin Bazunu.
City continued to apply the pressure and we finally breached the United defence with a wonderful through ball through to substitute Delap, who superbly lobbed the onrushing Mastny.
We had a spring in our step and with ten minutes left, we had a golden chance to equalise. Delap powered through again but was denied by Mastny’s parry, which fell to McAtee and his powerful shot was saved again by the scrambling goalkeeper.
We were piling on the pressure, but United’s defence stood firm and hung on to claim all three points.
What it means
The Young Blues remain at the top of the Under-18 Premier League table with 21 points, but Everton are now level with us after their victory.
How we lined up
Gavin Bazunu started as the goalkeeper, shielded by CJ Egan-Riley, Finley Burns, Luke Mbete-Tabu and Josh Wilson-Esbrand. Alex Robertson, Lewis Fiorini and James McAtee operated in midfield. Samuel Edozie and Ben Knight provided the width for frontman and skipper Cole Palmer.
Our Under-18s are next in action after the international break in the U18 Premier League Cup at home to Swansea City on Saturday 23 November, with kick off scheduled for 11:00 GMT.