 Teams qualified for the Champions League group stage , either directly or through three preliminary rounds , based on both their position in the preceding domestic league and the strength of that league . Each club needed to progress through the group stage and knockout rounds to reach the final , playing 12 matches in total . Liverpool finished second in their group behind 2004 Champions League runners @-@ up AS Monaco and subsequently beat Bayer Leverkusen , Juventus and Chelsea to progress to the final . Milan won their group ahead of Barcelona and faced Manchester United , Internazionale and PSV Eindhoven before reaching the final . Liverpool entered the competition in the third qualifying round after finishing fourth in the 2003 – 04 FA Premier League . They faced Austrian side Grazer AK and won the first leg 2 – 0 at Grazer after two goals from captain Steven Gerrard . They lost the second leg 1 – 0 at Anfield but progressed to the group stage by virtue of winning the tie 2 – 1 on aggregate . Milan entered the competition in the group stage after winning Serie A. The group stages were contested as eight double round @-@ robin groups of four teams , the top two qualifying for the knockout stages . Knockout ties were decided based on home and away matches . 
