Manchester City signed him for £270,000 in October 1980. Again he was a consistent regular amassing ninety-six League appearances and netting eleven times. McDonald was in the City team which lost the 1981 FA Cup Final to Tottenham Hotspur. He went to Oxford United in September 1983 and won a Third Division medal in his first season, followed by a Second Division medal in 1984-85. In League fixtures with Oxford he made ninety-four appearances and scored fourteen goals. He went to Leeds on a month's loan in February 1987, before joining them in a £25,000 deal to help United's push towards the Play-offs, but took no part in their progress to the FA Cup Semi-Final as he was Cup-tied.