Kevin Keegan led City into their third successive season in the Premiership and looked to strengthen the City defence by bringing in Danny Mills on a free transfer from Leeds,
Ben Thatcher from Leicester for £100,000 and Belgian keeper Geert de Vlieger on a free from Willem II.
Leaving Eastlands on free transfers were Danny Tiatto, Michael Tarnat and Gerard Wiekens. Youngster Stephen Elliott signed for Sunderland with a fee to be decided by tribunal, Arni Arason left the club after his 5 month spell and forgotten man Matias Vuosu signed a permanent deal with Mexican side Santos Laguna, where he’d spent the previous season on loan. The pre-season began with a short trip to Gigg Lane and a goal-less draw against Bury. A further draw followed, 1-1 at Doncaster, and then the goals flowed at Hull as the Blues won 4-0. and then 4-1 at Reading . A further 3-1 win at Wolves was overshadowed by a serious achillies injury to new goalkeeper Geert de Vlieger, leaving Kevin Keegan with no experienced cover for David James. The final warm up for the season saw City win The Thomas Cook Trophy by beating Lazio 3-1 at Eastlands. Fulham were the visitors for the first league game of the season and left with a point in a 1-1 draw. Then a trip to Anfield saw the Blues narrowly beaten 2-1 by Liverpool after Richard Dunne was sent off. Then a further away defeat followed 1-0 at Birmingham . To fill the gap left by Geert de Vlieger’s injury absence, Kevin Keegan brought in Dutch keeper Ronald Waterreus on loan from PSV Eindhoven. However the Blues parted company with Paulo Wanchope as he moved to Malaga for £500k. City notched their first win of the season with an excellent 4-0 victory against Charlton at Eastlands. However the inconsistency that has followed City for decades returned as they then lost at home 1-0 to Everton. Nicolas Anelka scored a brace at Crystal Palace to help City win their first away game since February and three days later Kevin Keegan rotated the squad in the Carling Cup 2nd Round, with four former academy players in the team, the youngsters showed they could be relied on as they equalled City’s record League Cup score by beating Barnsley 7-1 at Eastlands. City lost at home in the league for the second match on the trot with a 1-0 defeat to Arsenal , and then gained a point at Southampton in a 0-0 draw. And so after eight games The Blues were twelth in the Premiership but only three points off the relegation zone. The performance of the season so far for City saw leaders Chelsea beaten 1-0 by The Blues at Eastlands, and then, although Kevin Keegan’s team scored three goals at St James’ Park, they were beaten 4-3 by Newcastle in a seven goal second half thriller. Back to the Carling Cup and Kevin Keegan called upon the youngsters but they couldn’t overcome a very talented Arsenal team also full of youngsters and the Gunners won 2-1 at Eastlands. Back to the League and a disappointing 1-1 home draw against Norwich was followed by two further draws 0-0 at Old Trafford against Manchester United and 1-1 at home to Blackburn . But an excellent 3-1 win at Portsmouth followed which saw the Blues in mid-table after 14 games. Amazingly after 19 long months the Blues managed back to back league wins as they beat Aston Villa 2-0 at Eastlands. However City’s inconsistent tag was proven again as they then lost two league games on the trot, 3-2 at Middlesbrough and 1-0 at home to Tottenham . A 1-0 win followed at Bolton but this was followed by controversy off the pitch at the City Christmas party as Joey Barton stubbed out a lit cigar in youth player Jamie Tandy’s eye, after he had caught Tandy attempting to set fire to his shirt. Barton subsequently apologised for his actions and was fined £60,000 and did not take part in City’s Boxing Day game at Everton, which The Blues lost 2-1. In the last game of 2004 City drew 1-1 with West Brom at Eastlands leaving them in twelth in the League after 20 games. A New Years Day 2-1 home victory against Southampton was followed by an impressive 1-1 draw at Arsenal, however City’s bad record in Cups continued as they were embarassingly dumped out of the FA Cup in the 3rd round at lowly Oldham Athletic . Back to the league and a 3-1 win over Crystal Palace at Eastlands, but then a 2-0 defeat at West Brom. With the transfer window open two departures from City were announced. Nicolas Anelka moved to Fenerbahce for £7M and less significantly Ronald Wattereus moved to Rangers.
An addition to the squad was announced with the 6 month loan of Kiki Musampa from Atletico Madrid. Musampa made his debut at Eastlands in a 1-1 draw with Newcastle , then City played the top two in the league and gained a creditable 0-0 draw at Chelsea but lost 2-0 at Eastlands against Manchester United. At Norwich nine days later even a slurred half-time battle cry from The Canaries celebrity chef Director Delia Smith couldn’t stop The Blues winning 3-2. And so with ten games of the season left City stood in tenth position on 36 points. Kevin Keegan who had earlier in the season announced that he would be standing down as manager once his contract ran out at the end of next season, had given the Directors something to think about as how could top players be lured to the club with the knowledge that within a year the Manager they came to play for was no longer there and therefore following City’s next game, a 1-0 home defeat to Bolton which basically looked like finishing any chance of a European place, it was decided that Kevin Keegan would leave the club straight away. The official statement was that the parties had agreed the move by mutual agreement… in the best intersts of the club. three days later it was announced that Stuart Pearce would step up and take charge of the team until the end of the season, although the ‘Psycho’ made it known that he wanted to make it a permanent move into Management with the Blues. Stuart Pearce’s first two games in charge were both in London a 2-1 defeat to Spurs and a 2-2 draw at Charlton, however at home City produced a superb display to beat Liverpool 1-0 and then a further trip to London earned another creditable draw, 1-1 at Fulham, and so with five games left City were on 41 points and still mathematically in with a chance of scraping in to the last UEFA Cup place. It was another good home win for City as they beat Birmingham 3-0 and then a third away draw on the trot, 0-0 at Blackburn . City were on a roll and won for the third time on the trot on home soil beating Portsmouth 2-0. And so Just a month into his reign and Stuart Pearce was presented with the Barclays Manager of the Month award for a superb run of results in April.
A first away win for the Blues under Stuart Pearce saw City beat Aston Villa 2-1 and set up a last match showdown with Middlesbrough at Eastlands, the winner of which would claim the last UEFA Cup place. Just days before the game Stuart Pearce was rewarded for a successful nine week caretaker role with the announcement that he had been appointed as City’s new full-time manager. The final day of the season saw City play unusually in their new away kit and unfortunately it did not prove to be lucky for the Blues as the game finished 1-1 with a late penalty saved by Mark Schwarzer that denied City European football next season. The Blues ended the season in eighth place on 52 points. Richard Dunne was named City’s Player of The Year Award