Given the chance to lead the line for a second straight game, the 21-year-old, a £24million signing from Inter Milan last summer, thrived on the responsibility and his sumptuous first-half overhead kick brought his side to life after a sterile opening.
With Villa's resistance broken, Adam Johnson, Vincent Kompany and James Milner added second-half goals and Owen Hargreaves came on for his Premier League debut on a near-perfect afternoon for City, who pulled two points clear of cross-city rivals United ahead of next weekend's Manchester derby. Stephen Warnock netted a consolation for Villa.
Balotelli's goal was complemented by an industrious performance all over the pitch, reminiscent of his showing in the 4-0 win over Blackburn before the international break, with the Italian finally starting to look a more mature performer.
Having been relegated to a bit-part role owing to the form of City's other strikers and his own on- and off-field controversies, Balotelli is perhaps one of the few to benefit from the ongoing saga surrounding Carlos Tevez - the Argentinian missing again as his club continue to deal with his alleged refusal to play against Bayern Munich.
And with eight-goal Sergio Aguero injured and Edin Dzeko, Samir Nasri and David Silva all on the bench as Roberto Mancini made four changes, Balotelli had another chance to impress and took it, as Villa lost their unbeaten start to the season at the eighth hurdle.
Alex McLeish's men, who included former City favourites Richard Dunne, Shay Given and Stephen Ireland in a line-up showing two changes, arrived at the Etihad Stadium without an away win this season but it did not show as they made a confident opening.
Gabriel Agbonlahor robbed Joleon Lescott but failed to make the most of a one-on-one with Joe Hart and Warnock failed with the follow-up as City struggled to settle.
But Balotelli then decided to wake them up, hitting tamely wide before going closer when his 25-yard curler reared up in front of Given and forced the Irishman to turn it behind.
Balotelli's frustrations at his close shave had drawn some considerable goading from the Villa fans housed behind Given's goal, but he was soon able to silence them.
Johnson's 28th-minute corner hit an unsuspecting Micah Richards and fell perfectly for Balotelli, who produced a razor-sharp bicycle kick to leave Given flat-footed and take his tally of goals against Villa to five in three outings.
City were unable to score again before the break but did so two minutes after it when Warnock slipped as he tracked Yaya Toure's pass, leaving Johnson with a one-on-one that he did not waste.
It was Johnson's second goal in as many games and City thought they had a claim for a penalty a minute later when Balotelli took a tumble while navigating traffic in the area.
Referee Anthony Taylor was unmoved, but City were soon able to score a third without any help from the officials as Kompany, making his 100th start for the club, rose to nod in Johnson's corner with 52 minutes gone.
City's afternoon was slightly soured when Richards limped off just after the hour and, while he was doing so, Villa pulled a goal back as Warnock stormed on to Agbonlahor's cross - taking advantage of Richards' absence - to score.
It only provided momentary solace for Villa, though, who fell three behind again with 20 minutes remaining.
Nigel de Jong's long pass played in Johnson and, after some trickery from the winger, the ball was moved on to Milner who found the top corner from the edge of the box against his former club.
Silva, on for Toure, then went close after more impressive work from Balotelli, before Hargreaves came on for his first taste of Premier League action since an injury-halted seven minutes for Manchester United last November, immediately launching himself into two tackles as if to prove his fitness.