Both City players were shown yellow cards in Wednesday's last-16 first leg in Gelsenkirchen, and will be out for the second leg on March 12 at the Etihad Stadium.
The pair were each carded for fouls that led to penalties for the home side, with Nabil Bentaleb converting both spot-kicks to give Schalke a 2-1 half-time lead.
In the second half, Otamendi was shown a second yellow to leave his side down to 10 men for the remainder of the match.
But City would still win the first-leg tie 3-2 after goals in the final five minutes from Leroy Sane and Raheem Sterling.
Sergio Aguero gave City an early lead with a tap-in following a mistake from Schalke playing out of the back. That advantage would only last 20 minutes, though.
With 10 minutes left in the half, Otamendi extended his arm to block a shot from Daniel Caligiuri. After a lengthy delay for VAR a penalty was awarded, and Bentaleb fired into the bottom-right corner with his left foot.
It would get worse for City just before half-time as Fernandinho pulled down Schalke defender Salif Sane, who was trying to get on the end of a free-kick.
Again the home side were awarded a penalty and again Bentaleb deposited the spot-kick, giving his side a 2-1 half-time lead.
In the 68th minute, Otamendi clattered into Guido Burgstaller from behind to earn his second yellow card of the evening, leaving City down to 10 men.
But Sane's 85th-minute free-kick against his former side followed by Sterling's 90th-minute winner gave City a big advantage heading into the second leg.
The loss of Fernandinho could still be a big blow for City, as the Brazilian has been a vital performer for Pep Guardiola's side this season when healthy.
Guardiola underlined the 33-year-old's importance last month when he admitted that City had no true alternative to the holding midfielder on their roster.
"Fernandinho's specific qualities, we do not have a replacement for him – his kind of duels, the way he is going backwards," said the City manager.
The Brazilian has made 33 appearances for City this season in all competitions.
Otamendi meanwhile, has been a valuable squad player for City this season, though he has fallen behind John Stones and Aymeric Laporte in the centre-back pecking order.
The 31-year-old has made 22 appearances for Guardiola's side in all competitions this season.