Grealish impressed in Saturday's FA Cup win at Leyton Orient.
Guardiola said afterwards: "Jack has this sense of the street. He is a player of the street.
"Today most of the players, for a manager, are academic - 'you have to do this or that'. Jack is a fighter. He is there to fight in the stadiums when the people shout.
"He didn't play the last games, mainly because Savinho on the left side had an incredible connection with Erling (Haaland) but the season is still open.
"But against Orient I saw the glimpse that he is going to rebel, to show the manager how wrong he is. I love that."
He continued: "Players have to understand it is not new contracts that makes them better, it is the competition in the locker room and on the pitch.
"They have to feel they have to fight with Savinho and with (Jeremy) Doku. Phil (Foden) can play there as well. That is the point.
"In the end, it is about performance and delivering assists and goals."