City host the holders at the Etihad on Tuesday, days after narrowly beating Leyton Orient to reach the FA Cup fifth round.
De Bruyne remains confident, admitting City’s own mistakes in the group stage have made their European path more challenging.
He said: “I have played against Madrid in basically every round from the second to the semi-final in the last 10 years. We know why we play these games - because we didn’t do well enough before. That is it. At this level, it’s always (about) small margins.
“We know it’s a big game, the quality is there for both teams. It’s a two-legged tie so you don’t have to go crazy.”
He added: “Yes, but I have been here for 10 years so I probably played longer than a lot of players! Like Leyton Orient, I always try to respect the opponent, try to do my job. It doesn’t matter who we play. We just needed to take the game honestly.”