Club officials took the decision to withdraw the team from the field of play and cancel the game, after an incident involving Seko Fofana shortly before half-time
City's players were withdrawn shortly before half-time in Novigrad, Croatia, after an alleged incident of racial abuse towards Seko Fofana by a member of HNK Rijeka.
A statement released by the Premier League champions states that the club's management took the decision to withdraw the team from the field of play and cancel the game.
The matter is now being discussed between City representatives, match officials and the Croatian Football Association over whether the matter will be pursued further.
"Manchester City's EDS U21 game with HNK Rijeka has today been cancelled due to an alleged incident of racial abuse toward the Club's young midfielder, Seko Fofana by a member of the opposing team," read a statement on the club's official website.
"Following an alleged incident in the latter stages of the first half of the game, being played in Novigrad, Croatia, a decision was taken by the management staff to withdraw the City team from the field of play and cancel the game.
"Club representatives in Croatia and in Manchester are liaising with officials, the match organisers and the Croatian Football Association to pursue this matter further."