Barcelona stretched their La Liga lead over Real Madrid to a substantial eight points with a comfortable 3-0 win over Sevilla on Sunday.
The Catalans, aiming to win their first Spanish title since 2019, punished second-placed Madrid for their 1-0 defeat by Real Mallorca earlier on, opening up a wide gap ahead of their rivals.
"They are still the favourites because they are the reigning La Liga and Champions League champions," said Xavi.
"I know that Real Madrid will keep competing until the end. There have been historic comebacks, we can't let that happen."
After a tight first half Jordi Alba broke the deadlock before the hour mark, with further goals from Gavi and Raphinha helping wrap up the win.
The victory was their 10th in their last 11 league games, while Barca are now unbeaten in 15 matches across all competitions.
Xavi's side have conceded just seven goals in La Liga this season, with this their 15th clean sheet.
Jorge Sampaoli's Sevilla, 16th after a dismal start to the season, sat deep with five defenders and looked to frustrate the Catalans.
Eventually Alba pounced with a tidy finish after a superb assist from Kessie.
Raphinha teed up Gavi for the second with a raking low pass that left the youngster with a tap-in at the back post.
The Brazilian winger provided the cutting edge on a slick 17-pass team move for the goal, in an impressive outing in place of the injured Ousmane Dembele.
Alba crossed for Raphinha to finish from point-blank range for the third goal, wrapping up a satisfying day for the hosts.
Sevilla's former Barcelona midfielder Ivan Rakitic was serenaded by home fans but left dismayed at his team's lack of intent.
"I think that to be able to take something from Camp Nou, you have to be a lot braver," the Croatian told DAZN.
- Frustrated Vinicius -
Real Madrid's hopes of retaining the La Liga title were dented in their defeat by Javier Aguirre's determined Mallorca, in which Marco Asensio missed a penalty.
Nacho's 13th-minute looping header into his own net separated the teams in a hard-fought clash, frequently slowed by various fouls from the hosts.
Amid a constant battle between winger Vinicius Junior and Mallorca's players and supporters, the islanders held off Los Blancos to record an impressive victory.
Vinicius suffered 10 fouls and Mallorca committed 29 in total.
"I think everything that is happening and has happened is not Vini's fault, Vini just wants to play football, and beyond that, there's an atmosphere of provocation," explained Madrid coach Carlo Ancelotti.
"They foul him, that is what is happening."
Real Madrid were without goalkeeper Thibaut Courtois, hurt during the warm-up, along with the injured Karim Benzema, Eder Militao and Ferland Mendy, among other absentees.
The match was heated from the start, largely due to historic bad blood between Vinicius and Mallorca.
After Nacho's early own goal Vinicius was booked for stepping on Pablo Maffeo's foot, leaving the Brazilian incredulous after various fouls against him had not been punished with a card.
Vinicius pulled at the Madrid badge on his shirt while looking at the home fans to agitate them further.
Early in the second half Mallorca captain Antonio Raillo responded by offering Vinicius the Mallorca badge on his shirt to kiss.
Madrid had a golden chance to level before the hour mark when Mallorca goalkeeper Predrag Rajkovic brought down Vinicius, but the Serbian denied Asensio from the spot.
Madrid will have to put defeat behind them quickly as they travel to Morocco midweek to take part in the Club World Cup.
Real Sociedad, third, could not cut their six-point deficit on Madrid as they lost 1-0 at home against Real Valladolid.
Earlier Valencia, 17th, fell to a 1-0 defeat at Girona, who kept their first clean sheet of the season.