Klopp's side face City at Etihad Stadium on Thursday at 20:00 GMT.
City have lost two of their past three league games and are third, a point behind second-placed Tottenham.
Klopp said facing City is "one of the most difficult games you can play in the modern football world".
"We have to be prepared as good as possible, we have to be brave, we have to be full of desire, angry, like in all the other games," said Klopp.
"But with the knowledge the opponent is, for me, still the best team in the world. Only the points changed, not the preparation for the game."
City, who won the league last season with a record 100 points, have not won in four games against Liverpool and drew 0-0 when the teams met at Anfield in October.
The Anfield club's manager is adamant Guardiola's side remain a huge threat to Liverpool's hopes of ending their title drought.
"If we were 10 points behind would I say we can't catch them? Of course not," said Klopp.
"It's 3 January. A very important game - a kind of six-point game. It's a motivation for them 100%, and we need to be ready."
Klopp believes Liverpool's victory against City - who were clear favourites before the tie - across two legs in last season's Champions League quarter-final was a significant step in his side's development.
"Results and performances give confidence. We have results and performances," he said.
"Our boys have quality. As long as we mix up potential with attitude there will be quality.
"We got rid of the backpack when we reached the Champions League final.
"That was the moment when the boys did something special. Since then it feels different."
Liverpool, who are chasing their first league title since 1989-90, are the only unbeaten side in the league this season.