Iceland midfielder Sigurdsson will return to Reading on Sunday with Tottenham and McDermott revealed the 23-year-old's injury-time penalty against Liverpool during his time at the Berkshire club probably kept him in a job.
McDermott was in temporary charge at the time but had failed to guide the club to a victory in the Championship.
His side held Liverpool to a surprise draw in the third round of the FA Cup before traveling to Anfield for the replay, where Sigurdsson's coolly-converted penalty levelled the game and Shane Long bagged the decisive goal in extra time.
McDermott then led Reading to the sixth round of the competition and, after taking the job on a full-time basis, eventually back to the Barclays Premier League.
But the 51-year-old still remembers that night at Anfield and believes he is indebted to Sigurdsson for allowing him a stay of execution.
"I'm really looking forward to seeing him, he is definitely one of our own," he said.
"What he did for me personally when I got the job, if you consider it, we were at Anfield and I hadn't won a game as caretaker manager and Shane Long got a penalty in the 92nd minute.
"Gylfi took the best penalty I have ever seen under pressure, it was just incredible so I owe him a lot really."
McDermott's future would have been uncertain if it was not for the decent cup run and another name could easily haven been chosen to fill the void left following Brendan Rodgers' sacking.
The man himself is not even sure how close he came to losing the opportunity to take the team forward but said: "I will never know that, you will have to ask people here and they will tell you that I was going to get the chop but who knows?
"As a caretaker manager I wasn't very good - but in the FA Cup I was alright.
"I got lucky that night at Liverpool to get a penalty and for Gylfi to roll it into the corner the way he did, I will never forget that moment."
Sigurdsson was a product of the Reading academy and worked with McDermott since he first signed for the club in 2005.
He made his first-team debut in 2008 and instantly became a hit with the Reading fans, although he drew attention from other quarters and was sold to Hoffenheim in 2010, a decision that McDermott revealed was out of his hands.
"He is a great guy, we know his family really well and I'm sure he is going to get a fantastic ovation when he comes back and he fully deserves it," he said.
"Would I say he really, really wanted to leave? Probably not, definitely not I would say.
"It was something that was difficult for me, to see him go out of the door, but the circumstances were what they were at the time and the club needed the money so he went.
"You have got to say he has been fantastic for us in many, many ways."
The set-piece specialist then returned to England last season when he was signed on loan by Rodgers at Swansea.
He was widely expected to follow the Northern Irishman to Liverpool but instead joined Spurs and McDermott feels he would grace any team in the world.
"I believe he could play for anybody, he is that good," he said.
"He is a class act and he is a good guy as well and he works so hard, he prepares and practices - he is still very young and is nowhere near his peak yet."
Despite his obvious admiration for the player, McDermott said a move to bring him back to the Madejski Stadium during the summer was never on the cards due to the fee that would have been involved.
He said: "We couldn't afford Gylfi, it wasn't even a question of trying because there was no way.
"He has been here and done his bit and one day he might come back to Reading but who knows? At this moment in time he is playing for a massive club and I wish him all the best after Sunday."
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