English Premier League superpowers Manchester United and Manchester City crashed out of the Champions League as French side Lyon achieved a seven-goal miracle to reach the last 16.

United, the European champions in 1968, 1999 and 2008, slumped to a shock 2-1 defeat at Basel, a defeat which allowed the Swiss champions to go through from Group C with Benfica.

City defeated Group A winners Bayern Munich 2-0 but lost out on a last 16 spot when Napoli saw off pointless Villarreal 2-0 in Spain.

It was only the third time in 16 years that Sir Alex Fergusuon's United had crashed at the group phase with Wednesday's shocker coming six years to the day since they last bade farewell at the first round, following a 2-1 loss at Benfica.

Despite needing just a point to go through, last year's beaten finalists were undone by goals in each half from Marco Streller and Alexander Frei which condemned Ferguson's side to their first away defeat in the opening round in five years.

Phil Jones' late goal gave them a glimmer of hope but Basel soaked up waves of United pressure -- and rode their luck -- to book their place in the last 16 for the first time since 2002-03.

For United, who have played in three of the last four finals, there is now the unwelcome consolation of the Europa League.

Defeat only added to striker Wayne Rooney's problems, with the loss coming a day before he appeals against a three-match ban which could rule him out of Euro 2012.

"Of course we're disappointed, there's no other way you can feel," said Ferguson. "It's part of football. You have to deal with the disappointment, and this club has used it as motivation many times."

Basel coach Heiko Vogel, who only took over from Thorsten Fink in October, was overjoyed.

"It's a sensation, yes, because it's not every day you beat Manchester United," he said.

In a double dose of Mancunian misery, City also exited the tournament despite David Silva and Yaya Toure giving them a 2-0 win over a Bayern Munich side weakened by a dose of flu which had spread through the German squad.

English Premier League leaders City went into the match knowing the only way they could progress was to beat Bayern, who had already finished top of Group A, and for Napoli to fail to beat Villarreal.

Silva opened the scoring shortly before half-time at Eastlands and Toure scored a second just after the start of the second period.

But Napoli's 2-0 victory in Spain means Roberto Mancini's team will now have to combine their push for the Premier League title with a place in the Europa League.

"Usually, with 10 points all the teams go through, always, 99 percent," said Mancini. "This was a very strange group, it was a difficult group."

Napoli's victory put them in the last 16 for the first time in 21 years when Diego Maradona was still playing for them.

Lyon pulled off the night's most remarkable result when they defeated Dinamo Zagreb 7-1 in Croatia with the home side finishing with 10 men after the 28th-minute sending off of Jerko Leko.

Lyon went into their final Group D game three points behind Ajax and needing to make up a goal difference of seven.

French international striker Bafetimbi Gomis was the star of the show, scoring four goals, including the fastest ever Champions League hat-trick, as Lyon took second place in the group and a spot in the last 16 for a ninth successive season.

"It's fabulous," said Lyon coach Remi Garde. "The second half was incredible. It's difficult to believe that we could score three or four goals in such little time."

Real Madrid, who had already made sure of top spot and made a host of changes ahead of Saturday's El Clasico with Barcelona, downed Ajax 3-0 in Amsterdam to become only the fifth team in history to go through to the next round with a perfect record.

CSKA Moscow sneaked into the knock-out stages as Vasili Berezutsky scored three minutes from time to give the Russians a 2-1 victory at already-qualified Inter Milan in Group B.

With Trabzonspor holding Lille to a goalless draw in France, CSKA leap-frogged the pair to remain in Europe's premier club competition.

Ivory Coast striker Seydou Doumbia had given the visitors the lead before Esteban Cambiasso equalised but Berezutsky had the last word.