The England defender had smashed a clearance straight at Ederson that looped back towards goal and appeared certain to be gifting an opener to Jurgen Klopp's Reds.
But Stones raced back to poke the ball away, somehow evading the onrushing Mohamed Salah too, to deny Liverpool and keep the score at 0-0 at the time.
And City's official twitter account have released footage of Stones, and goalkeeper Ederson, watching the replay of the incident, with the centre-back heard shouting "Hadouken!" in delight.
It proved to be a vital intervention too, with City going on to win the game 2-1 courtesy of goals from Sergio Aguero and Leroy Sane.
The result means that the Premier League title race has been blown wide open, with City having now cut the gap to Liverpool at the top to just four points.
Indeed, Pep Guardiola went as far as suggesting that it would be almost game over for their hopes of catching the Reds, had they not beaten Klopp's men on Thursday evening.
"I am proud of them, but not just today," he said. "We lost two games in four days but you can't forget what they have done for 16 months. We knew that it was a final today, if we lose it is almost over.
"All credit to these incredible players. That is how we have to play in the Champions League. Both teams tried to search for each other, we were not scared, we had no fear and we had a lot of pressure.
"They are leaders, it is four points but we have reduced the gap. We knew that if we won we would be in contention to fight for the Premier league, if we lose it is over."
Stones has been in and out of the side in the 2018-19 campaign, making a total of 14 appearances in the league where he's been deployed at centre-back and in a holding midfield position.
City have won 10 and lost three of the Premier League games he's featured in, while they've kept four clean sheets and conceded 13 goals when he's been in the team.