After a growing number of errors, Hart was left out of the Capital One Cup win over Newcastle on October 30.
In total, England's World Cup keeper spent nine of 11 games on the bench before being recalled for the quarter-final victory at Leicester in the same competition.
Hart has kept his place ever since and on Saturday earned deserved man-of-the-match honours in a scrappy 1-0 win over Crystal Palace, when he made a succession of key saves, in addition to receiving a nasty gash near the eye following a first-half collision with Cameron Jerome.
It was the kind of display that earned Hart his status as the national side's undisputed number one.
Yet, according to Pellegrini, even Hart conceded when the axe fell he knew it was warranted.
"I did what I thought was best for the team and Joe Hart," said the City boss.
"At that moment, Joe needed the rest.
"Maybe he would not say it, but he agreed with me. He realised it."
The immediate reaction was to wonder whether Hart might agitate for a move away from the Etihad Stadium in order to preserve his England status ahead of the World Cup.
Instead, the 26-year-old redoubled his efforts and worked his way back into Pellegrini's favour.
Not that the Blues chief ever doubted that would be the eventual outcome.
"Maybe some other players would have reacted in a bad way but he always reacted in a very good way," said Pellegrini.
"That is why he has returned for us in very good form.
"He is the best goalkeeper in England, a goalkeeper for a big team and he makes important saves.
"That is normal for him and why he is the number one in England."
City were indebted to Hart for maintaining their 100 per cent home record.
Though the hosts dominated possession, they were largely limited to half chances until Edin Dzeko finished off Jesus Navas' cut-back to break the deadlock midway through the second period.
Yet just before Hart had superbly denied Jason Puncheon and not long afterwards Joel Ward was the man cursing his luck as Hart dived full length to repel a dipping volley that was heading for the top corner.
It was a rare lethargic home performance from the Blues - and exactly the kind of successful title-winning campaigns tend to be built around.
"I wouldn't say we won ugly," said City skipper Vincent Kompany.
"We just ground it out against a team that was really well organised.
"Credit to Palace, I was very impressed with the way they set up and they seemed to match us in the important moments."
For a brief period at least, it took City top of the Premier League for the first-time this season, following a run of seven wins and a draw from eight games.
Not that Kompany is reading too much into that given how difficult the season has been so far. And the Belgian expects it to continue in much the same way.
"Being top is important but it doesn't mean too much yet," he said.
"We've put ourselves in a nice position for the second half of the season but ultimately we arrive in January and there's still not much between all the teams.
"The league is still as tough as it's ever been, which is probably due to the new broadcasting resources. That's reflected in the strength in depth of all of the teams.
"As much as there are differences in the purchases between the top teams and the lesser one, the latter have still got incredible resources compared to other European leagues.
"That creates so much attraction towards the Premier League, and that's what you've seen at the beginning of the season; teams struggling to cope with the competitiveness of the league.
"Maybe that's why the top teams dropped points earlier in the season."
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