Hysen was part of the last Liverpool team to lift the league trophy in 1990, and ahead of their New Year's Eve clash with Manchester City, he believes the title had become a monkey on the backs of the current squad.
"I think it's embedded in their minds - 'you haven't won the league since 1990' - and if you get that, it's tough. But I know that the whole town is optimistic," he told Reuters.
Second-placed Liverpool trail league leaders Chelsea by six points before Saturday's games.
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The Reds showed character to come back from a goal down to thrash Stoke City 4-1 on Tuesday, but Hysen believes they still lack the general that could lead them to Premier League glory.
"They're still missing a real leader in the middle, a Steven Gerrard type. Guys like that don't arrive every day. Jordan Henderson is OK - he's not the kind that dictates, but he's still young."
Having dropped points to Bournemouth and West Ham United recently, Hysen believes victory over City will be necessary if Liverpool are to stay in touch with the leaders.
"There's a long way to go, but it'd be a damn good thing if they beat City. The four points they dropped to Bournemouth and West Ham...the league might be decided by four points. You have to take those points," he said.
"If they beat City, it won't decide the whole league, but they'll be in the picture."
Hysen still attends five or six games a year at Anfield, and says that the atmosphere in the city is different since Juergen Klopp took over.
"Klopp has turned it around brilliantly. Everyone in the city who likes Liverpool goes around with their chin up. Everyone is happy, he's great and everyone likes him, they love him."
Aside from Klopp's influence, Hysen believes there is still a long way to go in terms of rebuilding the atmosphere of invincibility that reigned when he was a Liverpool player from 1989 to 1992.
"When you went in to Anfield in those days, you were unbeatable. You went out with an unbelievable self-confidence," said the 57-year-old, who also represented PSV Eindhoven, IFK Gothenburg and Fiorentina, as well as the Swedish national team.
"You always thought you were going to beat the other team, so it was very hard for opponents to come there and win a game. The Kop was magic."
Despite an increase in capacity, the pressure-cooker atmosphere of Anfield is now a thing of the past.
"Liverpool is more and more a big European city, there's a lot of tourists who go to see Liverpool," Hysen said.
"The atmosphere isn't as good unfortunately, but when they sing 'You'll Never Walk Alone' it still sends shivers down the spine."
Still an avid Liverpool fan, Hysen believes it is only a matter of time before the Merseysiders are back on top of English football.
"They can't go for another three or four years without winning the league," he said.
(Editing by Clare Lovell)
