The reigning champions took some time to get going before taking the lead through Joleon Lescott late in the first half before Laurent Koscielny levelled in the 82nd minute to allow the Gunners to become just the third team to take a point off City in their last 31 outings at home.
Arsenal were the better side for most of the first half but conceded a needless corner in the 40th minute with Lescott rising above the pack to power home a back post header from David Silva's inswinging delivery.
The Gunners would have been deflated to go into the break a goal down and it showed early in the second half as City got right on top and attacked with more vigour than they had previously.
However, a determined Arsenal outfit clawed their way back into proceedings and managed an 82nd minute equaliser when Laurent Koscielny lashed home after City failed to clear a corner, allowing Arsene Wenger's men to go fifth on the table.
There were plenty of chances for both sides throughout with the best coming when Sergio Aguero forced a sharp save from Vito Mannone with his 14th minute effort from outside the area minutes before Gervinho was played through on goal by Ramsey but the Ivorian took a very heavy first touch to see the ball trickle towards an advancing Joe Hart.
Moments after the City goal, the home side were close to doubling their advantage when Edin Dzeko curled a left-footer around the corner which Mannone managed to get fingertips to.
City improved dramatically in the early stages of the second half and they were causing problems for Arsenal in the air with Javi Garcia's 56th minute header prompting a few heart flutters in North London but Mannone was on-hand to save safely.
Two minutes prior to the Gunners' leveller, Mannone managed to keep out Aguero's angled drive moments before Hart did brilliantly to deny Cazorla's thunderous effort from range with the ensuing corner providing Arsenal's goal.
Vincent Kompany's audacious 84th minute overhead attempt was superbly denied by Mannone before Aguero was so unlucky to see his effort from an angle go across the face of goal when he received Koscielny's erred clearance.
An erratic Gervinho had a fantastic chance to win it for the visitors when he slashed wide after getting himself clear in the 90th minute but in the end the draw was a deserved result which sees Roberto Mancini's champions sitting seventh following their third raw from five outings, the same record as today's opponents.
Etihad Stadium, Manchester - 47,318
Yellow cards:MC - Javi Garcia 90+2' ARS - nil