Pep Guardiola’s side took an early lead through Rico Lewis and Josko Gvardiol’s second-half goal sealed a comfortable semi-final success.
City can look forward to a showdown with Palace at Wembley on May 17 after the Eagles won 3-0 against Aston Villa in the other semi-final on Saturday.
Their 14th FA Cup final appearance gives City a chance to win the competition for the eighth time and the third since Guardiola arrived in 2016.
City lost to Manchester United in last season’s FA Cup final after beating their cross-town rivals in the 2023 showpiece.
Guardiola is hoping to salvage a turbulent season by lifting the FA Cup and qualifying for the Champions League via a top five finish in the Premier League.
City, who sit fourth in the league with four games left, will go into the final as favourites after thrashing Palace 5-2 at the Etihad Stadium earlier in April.
But nothing has come easy for City this season and Guardiola will need no reminding of that after their four-year reign as English champions was officially ended by Liverpool’s win against Tottenham at the exact moment the final whistle blew at Wembley.
Forest, only two points adrift of third-placed Newcastle with a game in hand, have to lick their wounds and focus on their bid to reach the Champions League for the first time since 1980-81.
It was City’s 28th trip to Wembley since it reopened in 2007 and just Forest’s second.
So it was no surprise the Forest hordes who made the trip were far more vocal as kick-off approached, while swathes of empty seats stood out in the City sections.
But it wasn’t long before City’s fans made themselves heard as they stormed into the lead in the second minute.
Guardiola had claimed this week that City will be much stronger next season because they have finally rediscovered their spirit and passion.
The City boss was encouraged by his players’ wild celebrations of Bernardo Silva’s early goal in a crucial 2-1 win against Villa on Wednesday and once again they made a fast start.
After a probing spell of City passing, Lewis was given far too much space on the edge of the Forest area and he took full advantage with a fierce drive into the bottom corner.
City’s pressing was too intense for Forest to handle and Nico O’Reilly waltzed through the Forest defence for a blast that fizzed just wide.
With Neco Williams suspended and Ola Aina and Ryan Yates injured, Forest boss Nuno Espirito Santo had gambled on 18-year-old Zach Abbott at right-back, while Anthony Elanga was surprisingly left on the bench.
For much of the first half, Nuno’s moves backfired, with Abbott — who had played just 60 minutes this season — repeatedly exposed by City’s attacks and Forest lacking a cutting edge without Elanga.
Forest failed to muster a single shot in the first half and had only one touch inside the City area.
Nuno sent on Elanga at the interval and the winger should have marked his 23rd birthday with a goal when he lashed wide from Callum Hudson-Odoi’s pass.
But City showed the ruthless streak that Forest lacked in the 51st minute.
Matheus Nunes’ effort was pushed away for a corner by Matz Sels and from Omar Marmoush’s set-piece, Gvardiol was left virtually unchallenged as he rose highest to head home.
Forest’s Morgan Gibbs-White crashed a volley off the crossbar, then clipped another effort off the post.
Taiwo Awoniyi also hit the woodwork for Forest with a back-heeled flick.
But it was too little, too late as City celebrated a victory that keeps alive their bid to avoid a first trophyless season since 2016-17. (AFP)