Fabio Grosso and Alessandro del Piero grabbed two goals in the last two minutes of extra-time to puncture the German World Cup party and send Italy into the final with a 2-0 victory.
With a penalty shoot-out looming, Grosso curled a fantastic left foot drive into the corner, and as Germany desperately searched for a late equaliser, substitute Del Piero broke free to guide in the killer second.
Germany had been seeking their eighth appearance in the final where Italy were hoping for a sixth -- both countries having won the trophy three times.
The game began at a terrific tempo and it rarely dropped as each side passed sharply and went forward probing for openings.
Generally, however, the defenders were able to resist most forays, with captain Fabio Cannavaro again masterful at the heart of Italy's back four and Italy's Simone Perrotta and Germany's Bernd Schneider missing the best of the few first-half chances.
The end-to-end approach continued after the break though neither side were able to muster the necessary precision to force the goalkeepers into serious action and Sebastian Kehl, in for the suspended Torsten Frings, and Italy's Gennaro Gattuso were both dominant in screening their defences.
Gianluigi Buffon did have to move sharply to end a Miroslav Klose run and then block a sharp shot on the turn by Lukas Podolski as the home side began to turn the screw midway through the second period.
Coach Juergen Klinsmann threw on wide midfielders Bastian Schweinsteiger and David Odonkor but neither man was able to make the difference and the game went into extra-time.
Germany had never beaten Italy in their four previous competitive matches including the 1982 World Cup final, but in the plus column they had never lost in Dortmund, winning 13 and drawing one of their 14 games there over 71 years.
If both records had remained intact it would have been penalties, where the Germans' World Cup record of four wins from four compared with the Italians' three out of three defeats would leave the hosts as favourites.
Perhaps with that in mind the Italians blasted out of the blocks in extra time and hit the woodwork twice in two minutes.
Substitute Alberto Gilardino carved through the retreating German defence but hit the post and then Gianluca Zambrotta smashed a 20-metre shot against the bar with Lehmann again helpless.
Podolski then headed wide from close in the last action of the first extra period.