Mariano Rajoy announced on Saturday that he was invoking article 155 of Spain's constitution to "restore the rule of law, coexistence and the economic recovery, and to ensure that elections could be held in normal circumstances".
Guardiola - a native of Catalonia and former player and manager of Barcelona - expressed his sadness at the development, following months of unrest in the region which came to a head in October's independence referendum.
After City's 3-0 win over Burnley on Saturday, the 46-year-old told Sky Sports News: "It's a really sad day for democracy. I thought in the 21st century, those kind of things didn't happen. Especially, for example, as the Catalan parliament is older than the Spanish parliament itself.
"I am really, really sad. The Catalan people just wanted to vote and we want to be listened to and let the people say what they wanted to be (part of Spain or independent). They did not allow us even that, the PP (Rajoy's ruling Partido Popular) didn't allow us to vote. They did what they did today just as the people protested with no violence.
"I think it's a really, really sad day for democracy. The only thing we wanted was to be listened to. Society's demands are stronger than any laws and I think, again, it is a really sad day for all of Europe and all the world what they did today."