City were minutes away from booking a place in the final before Real Madrid produced a stunning extra-time comeback to advance to the May 28 decider against Liverpool in Paris.
With only a point separating leaders City from Liverpool in the league with four matches left, Pep Guardiola's side host Newcastle United on Sunday, a team they beat 4-0 away in December but who have shown much improvement recently.
Guardiola said his players felt the pressure in Madrid but must now regroup for the title run-in.
"Now we need to process that and come back, with our people at home and the last four games we have," he said.
Liverpool host Tottenham Hotspur on Saturday and have the opportunity to retake the lead as they continue their bid for a historic quadruple of trophies.
Juergen Klopp's team are unbeaten at home in the league this season, having won 14 of 17 games at Anfield, and will be full of confidence after winning at Villarreal in Tuesday's Champions League semi-final second leg.
Tottenham last won at Liverpool in 2011 but Spurs manager Antonio Conte said his side would go to Anfield looking to take something from the match.
"Maybe someone can think that we have to get points in other games, but I think we have to prepare for this game and to go there and try to get points," he added.
"For us, every game is vital." Tottenham are fifth and chasing a berth in next season's Champions League but London rivals Arsenal, who are two points ahead in fourth spot, have an opportunity to solidify their advantage by beating struggling Leeds United at home on Sunday.
Norwich City have been relegated and Watford have little chance of survival, leaving Burnley (34 points), Leeds (34) and Everton (32) fighting to avoid the third relegation slot. Burnley host Aston Villa on Saturday while Everton, who stunned Chelsea 1-0 last weekend, travel to Leicester City on Sunday.
Burnley have collected 10 points from four matches since the sacking of Sean Dyche, with interim manager Mike Jackson adopting a more attacking approach.