Winger Khanya Leshabela stepped in for Sidnei Tavares in the starting XI, while trialist Dylan Barkers was replaced by right-back Danny Lupano, who is also on trial with the Football Club.
Midfielder Tyrese Shade, meanwhile, came in for Zimbabwe striker Admiral Muskwe following the defeat by Liverpool earlier this month and centre-back Sam Hughes skippered the side in London.
Inside three minutes, the Foxes were behind when Viktor Johansson felled Bukayo Saka in the box, presenting Charlie Gilmour with the chance to open the scoring from the penalty spot.
A difficult start got even more challenging for City when Gunners captain Ben Sheaf played in Saka, who subsequently slid it into the box for Tyreece John-Jules to finish a flowing attacking move.
While Leicester’s youngsters tried to retain possession, they were 3-0 down in the ninth minute as John-Jules returned the favour for Saka - and the 17-year-old drove it into the bottom corner.
Johansson was at his very best from that point onwards, however, making a duo of outstanding saves to deny John-Jules in quick succession – both from close range.
The Sweden Under-21s shot-stopper was there again on 31 minutes to palm it away when Sheaf played a through-ball into the path of John-Jules, but he couldn’t beat Johansson one-on-one.
City’s best opportunity of the opening 45 minutes came in the latter moments as Dominic Thompson’s misplaced pace was seized upon by Layton Ndukwu, but his shot flew wide from 20 yards out.
The visitors were far more assured in the second period and were able to keep the ball for long periods, although they did struggle to carve out opportunities in front of Arthur Okonkwo's net.
Left-back Luke Thomas went for goal from distance just before the hour-mark, but his long-range driver - after cutting in from the wing - was too high to concern Okonkwo.
Arsenal also threatened late on, with five minutes of the match to go, but Johansson saved well again to stop Xavier Amaechi - the last moment of note on the final day of City's season.
While unfortunate to come across a young Arsenal team in stunning form early on, Viktor Johansson was called upon to make a string of fine saves, especially to frustrate Tyreece John-Jules.
The home side will feel that they could have scored more in the first half, but it was Johansson who kept them at bay - with the best of his saves from John-Jules coming in a one-on-one situation.
Where does it leave us?
Leicester’s Under-23s - safe from relegation - remain eighth in Premier League 2 Division 1 on the final weekend of the season but Manchester City and Tottenham Hotspur could yet overtake them.
Ninth-place Man City entertain Swansea City at Academy Stadium and Spurs, in 10th-place, welcome Derby County to Lamex Stadium on Monday evening (both 7pm BST kick-offs).
While the domestic league season has now ended, a squad of 10 players from the Club’s Academy will head to Hong Kong next month for the HKFC Citi Soccer Sevens.
The Foxes have lifted the Main Cup prize on two previous occasions and reached the semi-finals of the competition last season. As ever, LCFC.com will be there to keep you updated.
City: Johansson, Lupano (trialist), Hughes (c), Pascanu, Thomas, Dewsbury-Hall, Kaba Sherif, Shade (Tavares 33’), Leshabela (Pennant 66’), Ndukwu, Tee
Subs not used: Davies, Kranthove, Loft
Images: Arsenal FC
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