Riyad Mahrez is finally back to his best after a frustrating debut season with Manchester City and the Premier League champions are reaping the rewards as they fight to keep pace with title rivals Liverpool.

When Pep Guardiola's side host Wolves on Sunday without the injured Kevin De Bruyne, Algeria winger Mahrez will be ready to shoulder the burden of driving City towards another priceless victory.

It is a far cry from Mahrez's first few months at the Etihad Stadium, when his then club-record £60 million ($74 million) switch from Leicester was in danger of becoming a nightmare.

Unable to recapture the form that won him the PFA player of the year award for his instrumental role in Leicester's 2016 Premier League title triumph, Mahrez cut a miserable figure.

It did not help that the superb form of Raheem Sterling and Bernardo Silva stopped Mahrez from garnering enough playing time to recover his rhythm.

Guardiola has since hinted that Mahrez became unhappy at his lack of action and let it affect his performances.

"He's quality. Perhaps the only thing he has to improve is to be more relaxed when he doesn't play. Only that. The rest is top," Guardiola said.

Mahrez's nadir came at Liverpool last October when he blazed a late penalty high over the bar to rob City of a win over their main challengers.

But Guardiola remained confident Mahrez would eventually turn the tide.

A defining moment came on the final day of the Premier League season when he was included in the starting line-up for the must-win clash at Brighton.

Guardiola's faith in Mahrez was rewarded when his blistering second-half strike opened up a 3-1 lead that eased City's nerves as they went on to lift the trophy.

Mahrez started again a week later when City thrashed Watford in the FA Cup final to complete the domestic treble and he has not looked back since.

With his morale on the mend, the 28-year-old captained Algeria to glory in the Africa Cup of Nations in July and has carried that form into this season.

When the Cup of Nations ended, City were already one game into their pre-season tour of Asia, meaning Mahrez had little respite from competitive action before the Premier League resumed.

But he was determined to stay in Guardiola's plans and impressed his boss by refusing the option of an extended summer break.

"I didn't have much holidays but that is what I wanted, because I wanted to be ready straight away. I am happy but I have to keep going," Mahrez said.

While he was already a believer in Mahrez's quality, Guardiola pinpoints the winger's uplifting experience with Algeria as a transformative moment.

"I think the Africa Cup made him believe how good he can be. He knows it but I think it helps to win this kind of trophy for Algeria, for his country," he said.

"It was so important for him. From the beginning he arrived with an incredible mentality, positive and the way he plays. He has something special."

Selected for the Premier League season opener at West Ham, Mahrez has seized his chance, playing with the swagger and intelligence that were the hallmarks of his best days at Leicester.

He has appeared in 10 of City's 11 games in all competitions, scoring three times -- including a superb free-kick in last weekend's win at Everton -- and providing seven assists.

"All this season he has been playing outstandingly" Guardiola said.

"He is an exceptional player. I'm happy for him because he's playing at an incredible level."