The game at the Etihad pits two of Leicester's closest rivals in the Premier League title race against each other.
The clash at the Etihad sees the fourth place side in the Premier League host the team two places higher, and Iheanacho is under no illusions of how important getting a positive result will be to the Sky Blues' title hopes.
"We have to treat it like a cup final and give everything we have in the game," he told Sky Sports.
"They have quality players and are second in the league so we have to fight them right to the final whistle."
With surprise league leaders Leicester opening up a five point gap at the top of the table - with the Citizens a further point back - both sides will go into the game knowing that a defeat, and perhaps also a draw, could prove incredibly damaging to either team's hopes of catching the Foxes.
And the 19-year-old's assessment of how hard City will have to work could well be based on their opponents' current form, as well as the scoreline from the last time these two sides met.
Mauricio Pochettino's men recovered from going a goal down to storm to a 4-1 win back in September, and with Spurs currently enjoying a six-match winning run in all competitions - while City were beaten 3-1 at home by Leicester in their last game - Pellegrini's side will surely have to put in a flawless performance if they hope to go above Sunday's opponents.