Craig Gardner's late equaliser from the spot for Birmingham left the big-spending visitors eight points behind Barclays Premier League leaders Manchester United - having played a game more.
Patrick Vieira sloppily conceded the penalty for a foul on Kevin Phillips with 13 minutes to play as Alex McLeish's Carling Cup finalists once again refused to roll over.
'It's too much for us,' said the frustrated Mancini when asked whether it was now too difficult to finish top of the pile. 'Right now it's very important for us to start playing football again.'
Pick that out: Tevez shoots past Martin Jiranek of Birmingham (right) to score
Mancini took issue with the penalty that denied his side three points and branded Phillips 'a diver'. But he had stronger words for his own team.
'I'm disappointed because we conceded two goals,' said the Italian. 'It's impossible to win if you keep conceding two goals every game. We have done this for the past four, five, six games. We work hard in training, but it does not happen in matches.
'At this moment, when the team is in January and February and the team is tired, you need to win 1-0. We will keep trying but if we play like this we won't do it. If we play better, then maybe we have a chance. But not like this.'
Injury blow: Micah Richards was carried off after a collision with team-mate Nigel De Jong (below)
Mancini packed his side with about as much attacking intent as possible, with Edin Dzeko and Carlos Tevez partnered together and David Silva afforded licence to roam.
It started well, with a goal inside four minutes. Birmingham left back Liam Ridgewell was caught horribly out of position and a ball from Nigel de Jong into Tevez's feet was met with neat control and the vision to spin a pass out to Silva on the open right flank.
The Spaniard met it and cut inside a retreating defence. His tame shot was collected 10 yards from goal by Tevez, who, with his back to goal, spun outside of Martin Jiranek and then screwed a low shot across Ben Foster and inside the post.
Birmingham's equaliser came via the boot of David Bentley, who was given the chance to sweep in a low centre from a free kick on the left. Manchester City's attempt to play the offside trap bordered on the laughable.
One light blue shirt remained deep as the others pushed out and it was left to Nikola Zigic to claim the goal as it flashed past an unprotected Hart. It was the faintest of touches from the Serb, if indeed he made contact at all.
On target: Birmingham striker Nikola Zigic (centre) levelled the scores during the first half
Minutes later came a sickening collision. Bentley's cross from the right bounced off the head of Jerome Boateng to the edge of the area. Micah Richards flung himself at the ball and, in the follow through, he caught his head on team-mate De Jong.
Richards, who was knocked out cold, was taken off on a stretcher and replaced by Kolo Toure, the England international spending last night in a Birmingham hospital.
Manchester City regained their composure and lead with a sweetly struck Aleksandar Kolarov free-kick soon after. TV replays proved just how much the left back's shot bent as it started off going wide before nestling in the bottom corner.
Back in front: Aleksandar Kolarov (13) scored City's second with a free-kick
But, following an heroic effort against West Ham to reach Wembley last week, and another equally titanic effort against Coventry City in the FA Cup last Saturday, McLeish was about to witness his group once more grab a point when for long periods little hope existed.
An attack appeared to have petered out after Stephen Carr had played a pass inside to Phillips. But the substitute held off the challenge of Vincent Kompany and laid off the ball, only for Vieira to overstep the mark and charge into the veteran forward.
Referee Kevin Friend was well positioned to make the award, which must have caused astonishment among the home crowd. They have gone more than a year in the Premier League since seeing a penalty decision go their way.
Two good: Birmingham City's Craig Gardner beats Joe Hart from the penalty spot
MATCH FACTS BIRMINGHAM (4-4-2): Foster 7; Carr 7, Jiranek 6, Johnson 7, Ridgewell 6; Bowyer 6 (Beausejour 75, 5), Ferguson 7, Gardner 7, Bentley 8; Zigic 6, Jerome 6 (Phillips 70, 5). Subs not used: Doyle, Larsson, Hleb, Fahey, Davies.
MANCHESTER CITY (4-3-3): Hart 6;Richards 6 (K Toure 36, 6), Boateng 6,Kompany 7, Kolarov 8; Milner 6, Barry 6,De Jong 5 (Vieira 46, 6); Tevez 7, Silva 7,Dzeko 6. Subs not used: Given, Zabaleta, Lescott, Jo, Guidetti.Booked: De Jong, Kolarov.Man of the match: David Bentley.Referee: Kevin Friend 6.
Though it was perhaps harsh, it was far from the cleverest challenge from a player with such a wealth of experience as former Juventus and Arsenal midfielder Vieira. Gardner wrestled the ball off Phillips and smashed the spotkick high into the roof of the net.
Mancini may have been sure it was not a penalty, but McLeish saw things differently.
'Roberto would say that,' said the Scot after hearing Phillips described as a diver.
'If you look at the penalties given against us they have been much, much softer than that.
'I'm sure Manchester City have had their fair share. But for me, it's a penalty. Vieira has clattered into him. How is that not a foul? Kevin was clattered. Pure and simple. Kevin Phillips is not a diver. He is a real true English gent
"He (Mancini) would say that. If you look at the penalties given against us this season, they were much, much softer than that. I'm sure City have had their fair share that Roberto would claim were penalties and were probably of the dubious kind.'
The late controversy would not have mattered had Kolarov found the net with the last kick of the game - another free kick that whistled just past the angle. That would have been very harsh on the hosts, though.
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Explore more:People: Craig Gardner, Alex McLeish, Roberto Mancini, David Bentley, Kevin Phillips, Kolo Toure, Patrick Vieira, David Silva, Ben Foster, Liam Ridgewell, Edin Dzeko, Vincent Kompany, Carlos Tevez Places: Birmingham, United Kingdom