The Premier League's bottom club face the defending champions at the Etihad Stadium desperate to halt a run of six successive defeats.
The odds are heavily stacked against Reading making a successful start to their Christmas schedule, but McDermott's mindset prevents him from settling for anything other than three points.
"Three years ago I made a decision that I would be fearless in the way I conduct myself in this management lark and I have stuck to that," he said.
"I was out with a friend of mine when I got the job and we had a conversation. I said 'I'm going to enjoy every single minute of this, I'm going to have no fear in each and every game'.
"I'm going to try and win games when it's a draw and I've stuck to that. I haven't gone into games with fear at any single moment.
"If you look at our record over the last three years, apart from the last 17 games it has been the right way for me and the right way for Reading.
"It suggests that it's been the right philosophy for me and the club because we've been successful."
Reading have struggled since winning last season's npower Championship, securing just one victory - against Everton on November 17 - to leave themselves six points adrift of safety.
Tomorrow they face one of their toughest tests yet against a side that has spent almost £500million on new players in four years. Last summer Reading celebrated promotion by spending less than £5million.
"Anything's possible in football. We know what we're coming up against, we know what a fantastic side they've put together, we're going to play the champions," McDermott said.
"I'm just looking forward to the occasion, I'm looking forward to the opportunity, and we'll see what the result is.
"We have to make sure we've got our shape right, we need to be prepared.
"We went there in the Championship for the quarter-final of the FA Cup and we were unfortunate to lose to a late goal, so we know what we're coming up against.
"We've got to keep going and wait for it to break for us, and when it does we've got to be ready."