Two goals in three minutes from Jack Grealish and Erling Haaland early in the second half looked set to give Manchester City an easy win in Paris. However, the home side fought back to equalise after just seven minutes through Ousmane Dembele and Bradley Barcola.
With the Citizens backed into a corner, Luis Enrique's side then won thanks to goals from Joao Neves and Goncalo Ramos. PSG will qualify with at least a draw away to Stuttgart next week. Meanwhile, the Citizens must beat Club Brugge at the Etihad to keep their hopes alive.
"We had our moments and they had theirs, but they were better. They were quicker, they won the duels, we couldn't cope.
They were very quick with the ball. The better team won. The game never went the way we wanted it to go," Guardiola said after the defeat to PSG.
Many believe that Man City’s recent resurgence, with four wins in five games, has ended their poor run of form, having lost nine of their 12 games before Christmas. But consistency remains elusive for the Citizens at the moment.
Guardiola's side lost their lead due to complacency and failed to keep up with their opponents in terms of effort. This is the ninth time this season that Man City have failed to win despite having a lead. That is why they are in such a difficult position in the Champions League.
The defeat to PSG means the reigning Premier League champions have fallen below the threshold of the top 24 teams and are facing the risk of early elimination. Despite being heavily underdogs, Club Brugge only need 1 point to secure their place in the next round. Therefore, Man City promises to face many difficulties.
Remember, Club Brugge have beaten Aston Villa and Sporting CP and drawn with Juventus in the Champions League this season. And all three teams have beaten Man City. Overall, Guardiola's team is in a dire situation.
"It could happen. Let's wait and see. If we don't beat Club Brugge in the next round, we don't deserve to be there.
"All away games are difficult, but that's the reality. We didn't get enough points," Guardiola said when asked about the risk of Man City being eliminated early in the Champions League.