The Serb produced a dominating performance against the world No2 with Federer unable to make inroads on the Djokovic serveÃ¢â‚¬â€the world No3 hit 69 per cent of first serves in.
Despite Federer managing to create 10 break point opportunities over the course of the three hours it took to complete the match, the Swiss could only convert three.
Federer, 29, has won the Australian title on four previous occasions but the Swiss star made 44 unforced areas and looked unusually vulnerable on his backhand side.
Djokovic, meanwhile, displayed steely nerve throughout and despite being broken late in the third set, hit back immediately to break Federer back and calmly serve out the match and reach his second final in Melbourne.
“I was feeling extreme pressure,” said Djokovic afterwards. “It’s one of the best matches I have played in a while. I had to take my chances. Second set I was 5-2 down. If I had lost that set God knows what direction the match would go.”
The 23-year-old won his only grand slam title to date Down Under in 2008, where he broke the dominance of Federer and Rafael Nadal after one of the pair won every Major since Marat Safin’s triumph in Melbourne in 2005.
This will be Djokovic’s fourth appearance in a grand slam final. In 2007 he suffered a straights set defeat to Federer at the US Open and two years later he lost to Rafael Nadal in four, again at Flushing Meadows.
Djokovic added that he expects a difficult test whoever he faces in the final. “I look forward to watching [the second men’s semi-final] from my bed with some popcorn,” he said.
MORE: The latest football news
MORE: The latest tennis news
BIOGRAPHY: Ethan Hazard
BIOGRAPHY: Daniel Sturridge