Last season's runners-up Liverpool overturned a 3-0 first-leg deficit as the Reds shocked Barcelona 4-0 at Anfield on Tuesday.
Sterling spent three years at Liverpool before joining Premier League rivals City in 2015 and the England international revelled in the result after winning the Football Writers' Association Footballer of the Year award.
"I was really happy for Liverpool, I was buzzing," Sterling said after receiving his award in London on Thursday.
"People might not believe me but it's true. Seeing some of the boys like [Jordan Henderson] Hendo and Trent [Alexander-Arnold] in the final makes me happy, I'm really happy for them."
Sterling has flourished this season, scoring 17 league goals and tallying 10 assists for Pep Guardiola's City.
"It's a massive achievement, a massive honour," he said. "To be recognised is always a lovely feeling, especially by the writers. It makes it even more special.
"It is an award that I will cherish, especially with the people that have won it before me so I am really, really glad and proud."
Sterling's performances have helped put City on the cusp of back-to-back Premier League titles heading into the final match of the season.
City are a point clear of Liverpool – having secured a 1-0 win against Leicester in their final home game of the season on Monday – as they prepare to travel to Brighton on Sunday, while the Reds welcome Wolves to Merseyside.
"We know how big an occasion it is," Sterling said. "But I'd much rather be on our side, to know if we win the game, it's ours.
"It will be a tough day, that's for sure. We know Brighton won't just sit there and let us score goals.
"They're safe and it is going to be a really tough day, to be honest with you, but it is one I am really looking forward to."