With teams limited to 17 overseas players in their squad for Uefa competition, City opted to leave out the 33-year-old midfielder.
Toure has starred for City in recent campaigns but has barely featured under new manager Pep Guardiola so far this season.
The Ivory Coast international has a year remaining on a contract with the Premier League club believed to be worth £230,000 a week.
Fellow internationals Samir Nasri, Wilfried Bony and Joe Hart were all allowed to leave City on loan on deadline day due to not being a part of Guardiola's first team plans.
City Champions League squad in full
Claudio Bravo, Willy Caballero
Bacary Sagna, Vincent Kompany, Pablo Zabaleta, Aleksandar Kolarov, Gael Clichy, John Stones, Nicolas Otamendi
Fernando, Raheem Sterling, Ilkay Gundogan, Jesus Navas, Kevin De Bruyne, Fabian Delph, Leroy Sane, David Silva, Fernandinho
Nolito, Sergio Aguero, Kelechi Iheanacho