A two-week fine is the maximum penalty stipulated in standard player contracts and, although City refused to comment on the case, they are privately confident of winning.
It is unusual for internal disputes between clubs and their players to go to a Premier League tribunal. The PFA has advised the player throughout and its chief executive, Gordon Taylor, told BBC Sport: "We try to avoid situations like this wherever possible, but the player and club have not been able to resolve this situation."
City began the disciplinary process after Balotelli was sent off against Arsenal in April 2012.
In all, he received nine yellow cards and three reds - one of them retrospective - during the season.
Balotelli was taken off early in the second half of City's 3-2 defeat by Manchester United on 9 December, and then left out of their squad altogether for the 3-1 win at Newcastle on Saturday.
After the match, City manager Roberto Mancini said: "At this moment, Mario is not in good form and for this reason he is at home. It is only for this reason. To get back into the team he needs to work in training and when he plays, he needs to play well."
Italian striker Mario Balotelli will face Manchester City at a Premier League tribunal in London on Wednesday.
Balotelli is fighting City's decision to fine him two weeks' wages for his poor disciplinary record last season.
The 22-year-old missed 11 games domestically and in Europe last season because of suspensions.
Balotelli appealed against the decision but an independent panel of City's board upheld the penalty. The case will now be heard by a three-man panel.
The striker is expected to appear in person, along with his Italian lawyer and a representative from the Professional Footballers' Association, while City will bring their legal team.