Pep Guardiola's side have made a brilliant start to the campaign, picking up 31 points from 11 league games to build up an eight-point lead at the top of table already.
Such has been City's high level of performance that Chelsea shot-stopper Thibaut Courtois recently labelled City as being “unstoppable.”
However, while Mignolet recognises the Manchester club's “quality”, he is adamant anything can happen in the title race as the season approaches the winter period.
"City are doing really well at this time," said the 29-year-old, who is currently away with Belgium on international duty.
"They've got loads of quality. But like always the Premier League is a long journey, there's a long way to go.
“After that win at West Ham we [Liverpool] closed the gap [on others]. In the busy winter period anything can happen.
"It's up to us to be challengers and that's what we'll try to do."
Liverpool remain 12 points behind City but have put together a strong sequence of results of late, winning their last three matches in all competitions.
The Reds downed West Ham 4-1 in their last league outing - a match in which Mignolet captained the club in the absence of Jordan Henderson and James Milner.
“I was surprised," said Mignolet when reflecting on skippering the Merseysiders. "I was only told an hour before the game.
"It was nice to hear that of course. If you read the list of Liverpool captains it was a great experience and I was proud.
"I am also the only Belgian to captain the club and luckily it brought some luck and we won the game."