Andy Murray pushed Novak Djokovic to the limit of his powers but went down in five sets to miss out on a place in the Australian Open final.
The British number one fought back from losing the first set to win the next two, and from 5-2 in the decider.
But defending champion Djokovic raised his level to battle through 6-3 3-6 6-7 (4-7) 6-1 7-5 in four hours 50 minutes.
The world number one, who beat Murray in the 2011 final, plays Rafael Nadal in Sunday's showpiece at 0830 GMT.
"I'm extremely delighted to be in another final," said Djokovic, who looked exhausted when Murray led 2-1.
"It was a physical match. Andy deserves credit for coming back. He was fighting, I was fighting.
"It was one of the best matches I've played."
Murray becomes the first man in the Open era to be eliminated in semi-finals at four successive Grand Slams.
But he can take heart from one of the best performances of his career so far, just a few weeks into his partnership with new coach Ivan Lendl.
Murray was outclassed by Djokovic in straights sets 12 months ago and for a time it seemed a repeat was on the cards.
The Scot faced two break points in his opening service game before a double-fault in his second handed Djokovic a 3-1 lead.
Murray was lacking aggression and although he hit straight back with a backhand winner, Djokovic replied with a devastating break to love.
The top seed served out the 47-minute first set to 15 and continued to dominate at the start of the second, racing 2-0 ahead.
Murray was starting to berate himself but denied Djokovic the double-break in game three and that proved a turning point.
Two perfectly constructed points - both finished with athletic smashes - helped Murray level, and he moved 4-2 in front when Djokovic drilled a backhand long.
The Serbian rallied in game seven but he was now looking spent and Murray outlasted him in a 41-shot exchange en route to a 5-3 lead.
Four huge deliveries helped him overturn a 15-40 deficit and level the match, paving the way for a gruelling third set.
An 18-minute opening game in which Djokovic saved five break points preceded back-to-back breaks for 2-2, and Murray saved three set points in game 10.
He then broke for 6-5 only to pull a backhand wide when serving for the set, gifting Djokovic the momentum going into the tie-break.
However, Murray snatched the early initiative and made sure he was never behind, powering over the line when Djokovic fired wide.
The fourth seed let out a huge roar in the direction of his support team but such intensity was absent in a 25-minute fourth set.
Djokovic raced 4-0 up and saved break points for 5-1 before striking to love as Murray appeared to have turned his focus to the decider.
A refreshed Djokovic broke twice to take total control at 5-2, but Murray stayed calm and crashed down two superb forehands for 5-4.
He could not complete the fairytale comeback, though. Djokovic held firm to move 6-5 ahead and breached the Murray defences one final time before falling to the floor in celebration.
Afterwards, Djokovic confirmed he was struggling with breathing problems brought on by hayfever and that he had seen a doctor about it.
"I think we both went through a physical crisis," Djokovic added.
"You know, him at the fourth set, me all the way through the second and midway through the third.
"It was one of the best matches I [have] played. Emotionally and mentally it was equally hard."
Looking ahead to the final against Nadal, Djokovic said he expected another stamina-sapping match.
"What can be a bigger challenge than playing against Rafa Nadal, one of the greatest players ever?" he said.
"I'm going to try to recover. Obviously it's going to be physical as well.''