Midfielder Toure was left off manager Pep Guardiola’s 25-man list for the group stages, sparking a row with his agent that led to him being frozen out of the side for a spell.
But since that dispute was resolved in November, Toure has reclaimed a place in the team and been in fine form.
His return to the Champions League squad comes as no surprise with fellow midfielder Ilkay Gundogan likely to miss the rest of the season through injury.
New signing Jesus, who scored his first goal since his £27million move from Palmeiras in City’s win at West Ham on Wednesday, takes the place of Kelechi Iheanacho.
Having now been registered at the club for two years, striker Iheanacho can be removed from the main quota but remain eligible as a player named on the ‘B’ list.
City face Monaco in the last 16 of the competition.