Everton make the short trip to Anfield looking for their first Barclays Premier League win there since 1999.
If that statistic suggests a lack of competitiveness in the fixture, the fact there have been 11 red cards in the last 14 league meetings between the sides tells a different story.
Dalglish said: "The derbies are perhaps more frantic and hectic but they will still be competitive. It will always be competitive but it is not malicious - and if it is not competitive you have a problem.
"You cannot take away the competitive spirit of a derby match. If you do that you may as well close the doors and not let anyone in.
"It is a great game to play in, there is a fantastic atmosphere, and the city should be very proud it has two fantastic clubs. Overall I think both the clubs have done more good than harm for the city."