Former England midfielder Lampard came off the bench at the Etihad Stadium to head the decisive goal in a remarkable 3-2 victory for City in the Barclays Premier League.
The result put City joint top of the table with Lampard's former club Chelsea, who were beaten by Tottenham later in the day.
It also emphasised the qualities New York City will have to wait longer to benefit from, coming less than a day after it was confirmed the 36-year-old's expected move to Major League Soccer would be delayed.
Lampard is now set to stay with City until the end of the season after a controversial agreement was reached with the club's sister outfit in the United States on New Year's Eve.
Supporters of NYC have been enraged as the player has been used extensively in the American club's marketing for their debut MLS season, which begins in March.
City manager Manuel Pellegrini claims he can understand the feelings of the American fans but he himself is clearly happy with the situation.
Pellegrini said: "Maybe all the New York fans, and I understand perfectly, they want to see Frank playing, because for the fans in New York to see Frank play is an amazing thing
"I hope that he will be there next year but I think that in this moment the best decision for him, for the club, for New York is to stay here with us."
The nature of Lampard's contract with City is still not clear
It was assumed that he had been on loan in Manchester from NYC but now it appears he was on a short-term, full-time contract with City with a view to moving to the American club after it expired on December 31
That agreement has now been extended until the end of City's season.
The suggestion is he will then move to New York but the possibility could exist that he might stay even longer in Manchester.
Pellegrini would not be drawn on that scenario at his post-match press conference.
"You cannot have all different questions about Frank Lampard," he said
"He will stay now with us until the end of the season."
The reason City wanted to keep Lampard was apparent as he settled nerves after a brilliant Sunderland fightback on New Year's Day.
A dull game burst into life when Yaya Toure crashed home a powerful shot in the 57th minute and Stevan Jovetic added another with a neat flick nine minutes later.
Sunderland produced a brilliant response as former City players Jack Rodwell and Adam Johnson, the latter from the penalty spot, struck in the space of three minutes to level the scores.
It was then Lampard stamped his authority on the game, heading home in the 73rd minute and he might have had two more but for fine late saves from Costel Pantilimon.
Lampard might not have been playing had his contract extension not been ratified, but Sunderland boss Gus Poyet was not concerned about his status
He said: "It looked to me last week that it was not possible (for Lampard to play) but apparently it was
How I don't know, I'm not an expert on the rules and regulations - but he made a difference, he scored the winning goal.
"For me it's clever, it's smart
It's legal, so I've got no problem with that."
Source : PA
Source: PA