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Dalglish guided Liverpool to victory over Everton in the second all-Merseyside FA Cup final in 1989, winning the match 3 – 2 after extra time, but was deprived of a second Double in the final game of the season, when Arsenal secured a last-minute goal to steal the title from Liverpool.
In the 1989 – 90 season Liverpool won their third league title under Dalglish.
They missed out on the Double and a third successive FA Cup final appearance when they lost 4-3 in extra-time to Crystal Palace in an FA Cup semi-final at Villa Park.
At the end of the season Dalglish received his third Manager of the Year award.
Dalglish resigned as manager of Liverpool ( on health grounds ) on 22 February 1991, two days after a 4 – 4 draw with rivals Everton in an FA Cup fifth round tie at Goodison Park, in which Liverpool surrendered the lead four times.
At the time of his resignation, the club were three points ahead in the league and still in contention for the FA Cup.

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