The Black Cats stunned title-chasing City at the Etihad Stadium, powering into a 3-1 lead before being pegged back by two goals from the hosts in the closing five minutes.
Larsson told SAFC TV: "Disappointment is the first word that springs to mind and it's a very disappointed dressing room. It looked like we were heading for victory, (but) they've had one penalty and two shots outside the box and sometimes you can't do much about it."
Larsson put Sunderland ahead just after the half-hour with a tidy low finish from the edge of the area.
Mario Balotelli replied with a penalty after Craig Gardner was controversially ruled to have upended Edin Dzeko, but the impressive Nicklas Bendtner headed the visitors back in front.
Bendtner then laid on the third for the inrushing Larsson at the back post.
That seemed enough for Sunderland, and Bendtner spurned a good chance to make it 4-1, but City finished strongly with long-range strikes from Balotelli and Aleksandar Kolarov in the last five minutes.
Sweden international Larsson said: "The fact that Manchester City had won 20 straight home league wins and we're disappointed to leave with a point says something about our performance.
"All three of our goals were excellent. The second one was important, coming straight after conceding a penalty which we were unhappy with.
"We'll probably be happy with the performance in a couple of days, but right now we're really disappointed."
Source: PA
Source: PA