City were ahead after 13 minutes against their most profitable opponents.
Josko Gvardiol picked up the ball on the left wing and played a neat one-two with Kevin De Bruyne as he cut inside and into the Fulham box before coolly slotting the ball past Bernd Leno with a finish a striker would be proud of.
From then on it was one-way traffic - Erling Haaland blazed a chance over after a mix-up between Calvin Bassey and Leno, and the German goalkeeper was forced into saves from Bernardo Silva and Phil Foden.
Pep Guardiola’s men should have added a second shortly before the break - following a short corner, De Bruyne swung in a cross to an unmarked Manuel Akanji inside the six-yard box, but the defender skied his volley over the bar.
Fulham turned to substitute Adama Traore at half-time in an attempt to carve out their first attempt of the match, and Marco Silva’s plan almost came to fruition when Traore found Rodrigo Muniz in the box in the 57th minute, and though Muniz’s compatriot Ederson had to make sure, his flicked effort was tricking wide.
That sparked a response from the champions, and two minutes later Silva went on a driving run to the edge of the box.
He was stopped by a crunching Joao Palhinha tackle, only for the loose ball to fall to Foden, who picked out the bottom corner of Leno’s net.
That goal meant City had scored at least two on nine successive trips to the Cottage.
Inside the final 20 minutes, the Citizens confirmed their two-point lead over Arsenal when Silva’s cross was met at the back post by Gvardiol, who stayed onside and squirmed his shot under Leno to put his side 3-0 up and double his goal tally for the season in one afternoon.
Deep into injury time, Issa Diop was sent off for a second bookable offence when he brought Julian Alvarez down inside the area, and the Argentinian stepped up and dispatched the penalty to round off the win.
The wait since September 2011 for a point against City goes on for the Cottagers, while City, on a seven-match winning run, are two more victories away from a fourth consecutive title.
Flashscore Man of the Match: Josko Gvardiol (Manchester City)