Manchester City beat Leicester 4-3 (1-1 AET) in a nerve-racking penalty shootout at the King Power Stadium to progress to the semi-finals of the Carabao Cup.

The Premier League leaders rested several big names as they brought in a few academy players for the cup tie on Tuesday while the Foxes fielded a mostly full-strength XI but it was not surprising to see the visitors dominate the early exchanges.

And the Citizens would take the lead after recovering the ball in the Leicester half with Ilkay Gundogan releasing Bernardo Silva for a one-on-one with Ben Hamer and the Portuguese slipped in a shot between the keeper’s legs in the 26th minute.

City continued to enjoy the lion’s share of the possession and had chances to extend their lead but somehow were unable to make their domination count and Leicester, lead by former City man Kelechi Iheanacho, looked dangerous on the break.

As the half-time whistle sounded, City had a slender lead and looked comfortable with the likes of Phil Foden, Ilkay Gundogan and Bernardo Silva all impressing.

As the match ticked on, it looked like the visitors would hold on for a win, but Leicester were handed a lifeline deep into injury time when Demarai Gray was bundled over inside the penalty area by Kyle Walker.

Jamie Vardy stepped up and beat Claudio Bravo to score a 97th-minute equaliser and extra-time ensued.

Both sides had plenty of half-chances in either half of extra time, but none were able to find that killer second goal and the prospect of a penalty shootout loomed large.

Leicester went first, with Christian Fuchs scoring with an emphatic finish but City responded via Ilkay Gundogan and Yaya Toure to wrest back the advantage.

Harry Maguire and Vicente Iborra subsequently converted their efforts with relative ease to put the visitors under pressure but Lukas Nmecha and Gabriel Jesus showed nerves of steel to send Hamer the wrong way.

Vardy was up next but this time his finish was found wanting as his effort hit the post and went out before Riyad Mahrez saw his effort saved by Bravo to send City through.

In the other quarter-final on the night, Arsenal edged London rivals West Ham United 1-0 courtesy of Danny Welbeck’s 42nd-minute winner.

Wednesday’s quarter-finals see Manchester United visit Bristol City and Chelsea host Bournemouth and there is a strong possibility the semi-finals will have all four heavyweights featuring.

City, who are coasting at the top of the Premier League at the moment, now host Bournemouth on Saturday and will look to register their 17th win in a row when the struggling Cherries come visting.

Leicester, who have now lost their last two games in all competitions, have no time to brood over the loss for they have to prepare for the visit of second-placed Manchester United on Saturday.