Sir Alex Ferguson's side was denied victory in its chase for the title by the climactic events that unfolded at the Etihad stadium, despite doing just enough to beat the Mackems
Wayne Rooney's header in the 20th minute was enough to secure the victory.
Manchester United began the day knowing that even victory would not guarantee the club an historic and dramatic title triumph, but it had to secure a win to even stand a chance and Rooney duly delievered by nodding home a Phil Jones center.
With chances at a premium, though, United comfortably closed the game out in the second half, with Sunderland rarely ever looking like scoring. As the final whistle was went, the events at the Etihad began to come to light with the astonishing news that Sergio Aguero had struck a sensational last-minute winner to snatch the title right out of United's grasp in the final minute of the season.
Sunderland boss Martin O'Neill made three changes to the side that was beaten 2-1 by Fulham at Craven Cottage, with Fraizer Campbell, Titus Bramble and David Vaughan all restored to the starting eleven in place of Ji Dong-Won, Matthew Kilgallon and Lee Cattermole.
Manchester United made two changes to the starting lineup from the side that ran out a comfortable 2-0 winner at home against Swansea last weekend. Chris Smalling was ruled out altogether with a hamstring injury, while Javier Hernandez was the front man sacrificed as Sir Alex Ferguson switched to a five-man midfield. Ryan Giggs and Jonny Evans were the players to be drafted into the team in their place.
With a raucous atmosphere at the Stadium of Light, slowly but surely. Manchester United began to establish its supremacy by dominating possession in the midfield and it took the lead in the 20th minute to keep the slim title hopes alive, after Rooney nodded in unmarked at the back post from a Phil Jones cross to hand his side the lead.
With the game becoming increasingly open, Ryan Giggs forced Simon Mignolet into a smart stop in the 27th minute before Rooney went fractionally wide with a free kick from the edge of the box. Moments later, Fraizer Campbell went close after volleying over inside the box on the stretch after latching onto a lofted through ball from Stephane Sessegnon.
The issue of United's profligacy in front of goal reared its ugly head again in the 37th minute when Rooney somehow failed to make contact on a scuffed Ashley Young shot at the far post, from just five yards out and with an open goal gaping. Ferguson's side had to settle with just a one-goal lead at the break.
United raced out of the traps in the second half, with Mignolet saving brilliantly at point-blank range from Rooney after being put through by Young before Jones nodded narrowly wide from a Young free kick from deep on the left.
The home side responded in kind, though, and went close through both Sessegnon and Bardsley with pops from outside the area as it rallied after surviving United's decent spell going forward at the beginning of the half.
With the clock ticking down and nerves jangling in the stands and out on the pitch, Rooney clipped the post with a free kick from outside the box in the 89th minute.
As referee Howard Webb brought an end to proceedings, though, and the United players began to applaud the away support believing they had secured the title, a quite simply unbelievable turn of events at City meant that Ferguson's charges had come up frustratingly short in their bid for the title, losing out to their noisy neighbors.