United looked in pole position to overtake City on the final day after their bitter rivals fell 2-1 behind to QPR at the Etihad Stadium.
The Blues appeared set to endure a awful afternoon when Djibril Cisse and Jamie Mackie overturned Pablo Zabaleta's first-half strike, despite QPR having Joey Barton sent off.
But Ferguson's men, who beat Sunderland thanks to Wayne Rooney's 20th-minute strike, were denied in the cruellest possible circumstances as injury-time goals from Edin Dzeko and Sergio Aguero gave City a 3-2 win and rendered United's result irrelevant.
"Nobody expected that," Ferguson told BBC Sport. "Everybody expected City to win, but they did it against 10 men for half an hour and with five extra minutes to help them.
"But I congratulate City on winning the league. Anybody who wins it deserves it, because it's a long haul.
"At the end of our game our players didn't actually know the results. Now, they're really disappointed, I'm glad to say.
"There's no other way they should be. They conducted themselves brilliantly today.
"Their performance level was good. I'm pleased at our performance this season. Eighty-nine points would win most leagues. It wasn't our turn today."
Ferguson felt it was a harsh way to hand over the league title they won last year, but acknowledged he has had many happy memories on the final day of a league season.
"It's a cruel way [to lose the title] but we've experienced many ups and downs in the 25 years I've been here - most of them are great moments," Ferguson said on Sky Sports 1.
"We've won the league title three times on the last day and today we nearly did it."
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The veteran manager was pleased with the way his side approached the match against Sunderland.
He said: "Coming into the last game I said, 'Concentrate on your job, that's what we have to do', because you're going to get certain types of reaction from the crowd and you saw that.
"You just have to put that to one side and concentrate on your own game which I thought we did really well."
United end the season trophyless for the first time since the 2004/05 campaign, yet Ferguson is determined to focus on the positives.
"I think we take credit in the fact we've had so many injuries this season and we've coped with that very well," he added.
"Some of the young players have gained some experience and they'll be around in five, six, seven years time all these young players at Manchester United.
"Experience is good for them - even if it's a bad one."