An inconsistent season from both Manchester clubs has seen them drop to fourth and fifth place in the Premier League standings, with the Red Devils now just a point behind with seven matches left in the campaign.
And midfielder Herrera feels his side have what it takes to beat City to the last continental qualification spot and secure their Champions league berth for next season, where he feels the Red Devils belong.
"When you're fifth in the table and want to be in the top four, you have to maintain this form," he said following United’s 1-0 win over Everton.
"It's not going to be easy because Man City also want to be in the Champions League, but we have to fight for it and I think we're ready.
"Man City has a bigger squad, very good players, but I think right now we can fight against them.
"We're just one point behind them and I think the last game we showed that we are a little bit better than them right now.
"We beat them away in the Manchester derby so we can be optimistic.
"Man United should be every year in the Champions League. I think in the last 25 or 26 years, there was just one time we didn't play Champions League, so we want to be there again."
Herrera then noted the tough fixture that awaits City this weekend, while highlighting the return of key players as a major boost for his club.
"They [City] have to play against Newcastle away," he said.
"Newcastle are playing to avoid relegation so it is going to be tough for them.
"We have to play Tottenham next, but when we play against top teams, I'm not so worried about our performance because I think we usually do quite well.
"We are recovering some important players for us, like Wayne, Ash, Antonio [Valencia], Phil Jones and [Luke] Shaw and that gives us confidence."
United’s clash against Spurs kicks off at 5pm at White Hart Lane on Sunday.