Manuel Pellegrini's men and Bayern have met on four occasions in Europe's elite club competition over the past three years, with the sides claiming two wins apiece.
City claimed all three points in their most recent meeting - a 3-2 victory away from home in December after overturning a two-goal deficit in the Group D clash.
And Milner, who scored the winning goal last time around, pointed at that result as cause for optimism leading into this week's Group E fixture in Germany.
"We should know them pretty well now, we've played them a lot these past couple of years, even in friendlies, so we know they're a top team," he said.
"You can't do what they've done over the last few years and have their record in the Champions League without being a top team, but you want to play against the best teams and we"ve done that.
"We beat them at their place last year and we should take a lot of confidence from that and go into the game with no fear, knowing we've been there before and got three points."
Milner added: "I don't think there's many teams who would have come back from that.
"It would have been game done, but that shows the character and the quality we have in the squad, and to have that mental strength to come back and win the game is massive."