Victory takes City to within two points of Premier League leaders Arsenal, who play at Fulham today.
Pep Guardiola’s men dominated for almost the entire 94 minutes at a sodden Selhurst Park, but were headed for another major blow to their title defence until Ilkay Gundogan was chopped down inside the box by Michael Olise.
Haaland kept his cool to roll home his 34th goal of the season from the spot.
“I enjoy it, this is England, this is what I have watched my whole life,” said Haaland on challenging for his first Premier League title.
“I enjoy every single second being in it. It’s good to be in the middle of it.”
Earlier, Liverpool were brought back to earth with a bang after inflicting Manchester United’s record-equalling defeat in a 7-0 win last weekend.
Philip Billing scored the only goal for Bournemouth to lift the Cherries out of the bottom three as Mohamed Salah fired a second half penalty wide.
“The game was pretty much the opposite of what we wanted to show and to do today. I think we played for pretty much 95 minutes the game Bournemouth wanted to play,” said Liverpool boss Jurgen Klopp.
“This game was a massive knock and how it is with knocks, you have to take them, you have to have a look how big the scars are and then you go from there.”
Fifth-placed Liverpool are now six points adrift of the Champions League places after Harry Kane ensured a tough week for Tottenham ended on a high by scoring twice in a 3-1 win over Nottingham Forest.
Kane lifts Tottenham
The England captain’s future has been a source of speculation after Spurs crashed out of both the FA Cup and Champions League in the space a week.
Antonio Conte’s men had failed to score in their previous three games, but Kane ended that drought by rising highest to head in Pedro Porro’s cross.
Kane then coolly slotted home his first penalty since missing a crucial spot-kick in England’s World Cup quarter-final exit to France.
Richarlison made amends for criticism of Conte this week by teeing up Son Heung-min to fire in Spurs’ third.
Joe Worrall pulled a goal back for Forest, who then also had a stoppage time penalty from Andre Ayew saved by Fraser Forster.
Lineker sees Leicester lose
Gary Lineker made the most of his absence from the BBC’s flagship football highlights programme Match of the Day to watch his beloved Leicester lose 3-1 against Chelsea.
Lineker was forced to “step back” from his presenting duties after comparing the UK government’s rhetoric towards refugees this week to Nazi-era Germany.
Leicester remain rooted in the relegation battle, just one point above the drop zone after a fifth consecutive defeat.
Ben Chilwell put Chelsea ahead early on against his former club before Patson Daka levelled.
But a sensational pass from Enzo Fernandez and finish from Kai Havertz put Chelsea back in front and Mateo Kovacic’s strike secured a third consecutive win for the Blues, who continue to lift the pressure on Graham Potter.
Everton moved out of the bottom three and up to 15th thanks to a third 1-0 win in four home games under Sean Dyche.
Dwight McNeil smashed in the only goal inside the first minute to end Brentford’s 12-game unbeaten run in the Premier League.
Leeds remain second from bottom but closed to within a point of safety after twice coming from behind to draw 2-2 at home to high-flying Brighton.
Alexis Mac Allister put the Seagulls in front before Patrick Bamford levelled before the break.
Jack Harrison then scored at both ends in the second half to leave Brighton still nine points off the top four, albeit with three games in hand.
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