With the Blues facing Liverpool in the quarter-finals, the German midfielder is of the opinion that any team who makes the last it to the last eight deserves maximum respect.
“At the end you need to play against the best to win this trophy,” said Gundogan.
“You must compete against the best to get to the final and, of course, to win it.”
CHAMPIONS LEAGUE DRAW: City face Liverpool
Having made the Champions League previously with Borussia Dortmund, Gundogan is well-aware of the demands of the competition and the quality of the remaining opposition.
“I was lucky enough to play in the Champions League final in 2013 with Borussia Dortmund, unfortunately we lost, so obviously I can’t wait to try and get to a final and win it this time - that is my main target,” he said.
“Fortunately, we won the Carabao Cup and we are very happy about it, to gain our first trophy quite early in the season. This is now in our hands, nobody can take it away.
“For us, this is just the beginning. We are in good shape to face the elite clubs in Europe, but I wouldn’t say we are there just yet.
“We need to compete with teams like Real Madrid, Barcelona, Bayern Munich – the biggest teams on a regular basis, so it doesn’t make a difference who you get at this stage.”