The Austrian winger, who is on loan from Inter Milan until the end of the season, will line up against Pep Guardiola’s side at the Etihad Stadium a week on from his fine showing as a substitute in the Magpies’ 4-1 win at Bournemouth.
Lazaro bagged United’s third goal after coming off the bench on that occasion, and has now earned a start against last term’s champions as Steve Bruce shuffles his pack following Sunday’s 2-2 draw with West Ham at St. James’ Park.
Martin Dúbravka starts in goal, with DeAndre Yedlin coming in at right back to play alongside Emil Krafth, Fabian Schär, Federico Fernández and Danny Rose.
There are six changes to the Newcastle team in total, with Jonjo Shelvey captaining the side in the absence of Jamaal Lascelles and Nabil Bentaleb alongside him.
And Matt Ritchie and Lazaro will provide support for frontman Joelinton, who gets the nod to lead the line.
Two Academy graduates in Tom Allan and Jack Young are named on the bench by Bruce, with Christian Atsu and Yoshinori Muto also back among the substitutes.
Winger Miguel Almirón could also be called upon from a bench boasting plenty of firepower, with Dwight Gayle also named.
Matty Longstaff, Javier Manquillo and Karl Darlow complete the list of players available for Bruce to bring on if required.
Newcastle United: Martin Dúbravka; DeAndre Yedlin, Emil Krafth, Fabian Schär, Federico Fernández, Danny Rose; Valentino Lazaro, Jonjo Shelvey, Nabil Bentaleb, Matt Ritchie; Joelinton.
Substitutes: Karl Darlow, Javier Manquillo, Matty Longstaff, Jack Young, Christian Atsu, Tom Allan, Miguel Almirón, Yoshinori Muto, Dwight Gayle.