Ali Reghba's 59th minute goal, followed by a wonderful late Mitchell Clark strike, handed City all three points and a perfect start to the season against the Red Devils.
The young Foxes were playing their first league game since a 3-1 victory over Southampton on 2 March, when George Hirst, Callum Wright and Conor Tee were all on the scoresheet.
City's Development Squad were hoping to build on last season's second-placed finish, which was decided on a points-per-game basis after the 2019/20 league campaign was cut short due to the COVID-19 pandemic.
There were three changes to the starting XI that defeated Hull City 2-1 in the opening game of the EFL Trophy last week, with Vontae Daley-Campbell, Darnell Johnson and Khanya Leshabela coming in.
City lined up in a 4-1-4-1 formation with Callum Hulme sitting in front of the back four and Reghba acting as the line forward.
Manchester United, meanwhile, opted for a 4-2-3-1 formation, in their first league fixture since promotion from Premier League 2 Division 2.
City created the first opportunity of the game as Leshabela struck the post with a curling right-footed effort from the edge of the area inside the opening five minutes.
Clark then drove forward and opted to go for goal, narrowly missing the target from 20 yards out in what was a sign of things to come.
The away side hit the woodwork for the second time inside the first 15 minutes when Hulme saw United's 'keeper off his line and clipped the top of the bar with his effort.
The chances kept coming for City's Under-23s - Shane Flynn picked out Reghba in the middle, but Di'Shon Bernard was able to divert his shot out for a corner, before Tyrese Shade fired in a powerful effort that went just over the bar.
Leicester fashioned plenty more opportunities as Daley-Campbell's cross was met by Reghba, who couldn't get any meaningful contact on the header.
Another opportunity came before the break when Sam Hughes rose highest at the back post from Layton Ndukwu's deep corner, but headed wide of goal.
Despite their dominance, the lack of a breakthrough meant United were still well in the game and could have snatched a lead just before half-time with Hannibal Mejbri forcing Jakub Stolarczyk into a save.
And then the 'keeper was called into action again to keep out Anthony Elanga, producing a brilliant diving stop, before Clark denied the United midfielder with a goal-line clearance.
After the break, James Garner's free-kick was held by Stolarczyk as United started the second half on the front foot.
An early second half chance also fell the way of the visitors as Reghba created an opportunity for himself out of nothing, taking the ball down and striking a deflected shot wide.
The game started to become more stretched and Stolarczyk had to steer the ball to safety, getting down quickly at his near post to deny Elanga, before Hughes' header was again kept out.
The deadlock was finally broken on the hour-mark when the ball deflected into the path of Reghba, whose shot on the turn found the bottom corner.
Johnson blasted wide from inside the area soon after, with City's Under-23s pushing for a second goal.
He would also be called in action at the other end, blocking Mark Helm's goal-bound effort after the United forward twisted and turned to create space for a shot.
And Elanga once again managed to get into the box late on, but when the space opened up for a shot, he found Stolarczyk unbeatable.
City made the game safe five minutes from time, thanks to a stunning strike from full-back Clark, who rifled his effort into the top corner from 20 yards out.
Stolarczyk kept out Shola Shoretire in added time to preserve the clean sheet and ensure his side sealed their first three points of the season.
Irishman Ali Reghba opened the scoring at Leigh Sports Village.
Ali Reghba's opener gave City control of the game and helped secure a first three points of the new campaign.
It was a calm and clinical finish from the Irishman to open his account for the season and gave his side the perfect springboard in the latter moments.
Captain Sam Hughes was an imposing figure in the centre of defence, winning headers throughout the game and helping City to keep a clean sheet.
He could have even added a goal, twice going close with headers, when the young defender ventured forward for set pieces.
Where does it leave us?
City move up to first in the table after the opening round of fixtures and are one of four teams on three points. They lead Southampton, Chelsea and Liverpool at the early summit on goal difference.
City's Development Squad travel to face Everton next Monday evening (7pm kick-off).
City’s youngsters are next in action on Monday 21 September, when they travel to face Everton in their next Premier League 2 fixture at Southport's The Pure Stadium (7pm BST kick-off).
The Toffees lost 1-0 to Liverpool Under-23s in their opening league fixture last Sunday.
City: Stolarczyk, Daley-Campbell, Clark, Hulme, Hughes (c), Johnson, Shade (Pennant 80'), Leshabela, Reghba (Russ 86'), Ndukwu (Marcal-Madivadua 90'), Flynn
Subs not used: O'Connor, Bosworth
Goals: Reghba 59', Clark 85'
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