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PSG won 2-1 in the French capital thanks to a goalkeeping howler by Porto's Helton who allowed Argentine Ezequiel Lavezzi's low shot through his grasp. PSG and Porto were already assured of a place in the 16 of Europe's elite club competition.
Schalke 04 went through as Group B winners with a 1-1 draw at Montpellier, leaving Arsenal as runners-up after they lost 2-1 at Olympiakos Piraeus.
While money has talked for PSG, at least on the European stage after they splurged about 150 million euros (121.9 million pounds) on players in the close season, Manchester City's mega-rich Abu Dhabi's owners are counting the cost of a second successive season of continental failure.
A 1-0 defeat in their final game at Group D winners Borussia Dortmund means the Premier League champions have finished bottom without a win. Their total of three points was the lowest haul from an English team in the Champions League group stage.
Ajax Amsterdam claimed the Europa League place instead of City for finishing third, despite being crushed 4-1 by Real Madrid, as did Zenit St Petersburg in Group C thanks to a 1-0 away win against a weakened AC Milan sdie at the San Siro.
Last season Manchester City were unfortunate to miss out on qualifying for the Champions League knockout stage having taken 10 points in their group but this time there were no excuses.
"Of course we have let ourselves down, because we haven't even got in the Europa League," City goalkeeper Joe Hart, beaten by Julian Schieber's 57th-minute goal, told Sky Sports.
However, England's Hart said City had "bigger issues" that needed to be addressed than missing out on the much-maligned second-tier European club competition.
"We were up against a weakened team and we had to win. We should be fighting to go through to the last 16 on the last day and we have only got ourselves to blame that we are not," he said.
City are the first Premier League team to finish the group stage without a win and replace Blackburn Rovers, who got four points in 1995-96, as having the lowest points tally recorded by an English team from their six Champions League group games.
With none of the three remaining last-16 places up for grabs until Wednesday's eight ties, the focus was on the battle for group supremacy and Europa league places.
PSG needed to beat Porto to leapfrog the Portuguese and produced a performance to please manager Carlo Ancelotti, under fire from French media after three defeats in five league games.
"The players showed a lot of pride tonight because the critics had been very harsh," the Italian told reporters.
Brazilian centre back Thiago Silva's fine header from Maxwell's cross put the French side ahead but Colombian striker Jackson Martinez quickly levelled from close range.
PSG won it just after the hour thanks to Helton's blunder.
Schalke finished two points ahead of Arsenal who lost at Olympiakos for the third time in four seasons.
Benedikt Hoewdes's diving header put Schalke ahead at Montpellier 11 minutes into the second half but the goal was quickly cancelled out by Emanuel Herrera's strike.
Arsenal manager Arsene Wenger, coming under increasing scrutiny for his side's indifferent form in the Premier League where they languish in 10th place, made wholesale changes for the trip to Athens and his weakened side fell short.
Substitute Kostas Mitroglou fired home a 73rd minute winner for Olympiakos barely a minute coming off the bench.
Giannis Maniatis had bundled in a 64th minute equaliser for the Greeks, cancelling out Tomas Rosicky's first-half opener.
Rosicky's goal was at least one bright footnote for Wenger with the Czech Republic midfielder starting his first game of the season after a long recuperation from an Achilles injury suffered during Euro 2012.
Like Wenger, Jose Mourinho has had his detractors recently in the Spanish capital but his Real Madrid side turned on the style to brush aside Ajax.
Cristiano Ronaldo netted the first, Jose Callejon latched on to an exquisite Luka Modric pass to score the second and Kaka curled in a superb third. Callejon got his second near the end after Derk Boerrigter's consolation for Ajax.
Zenit secured their qualification for the Europa League with Portuguese winger Danny's first-half strike at Milan, who rested players having already qualified.
Seven-times European champions Milan might have expected to underline their pedigree by topping the group but that honour had already been secured by Malaga.
The competition debutants were held 2-2 at home by Anderlecht in their final game which was marred by clashes between police and visiting Belgian fans in the stands.
A stoppage-time penalty from substitute Ivan Krstanovic handed Dinamo Zagreb a first goal and point in Group A with a 1-1 draw at home to Dynamo Kiev but the match will be remembered for the difficult playing conditions in the Croatian capital.
Heavy snowfall forced a 15 minute delay early in the first half as the players were taken off for the pitch to be remarked in red paint.
The draw for the last 16, in which the eight group winners are paired with the eight runners-up, takes place on 20 December.