The 30-year-old Spaniard looked every inch a 14-times grand slam champion as he slugged it out with his 25-year-old opponent over nearly five hours on Rod Laver Arena to reach his first major final since the 2014 French Open and 21st overall.
"Grigor was playing unbelievable, it was a great match," Nadal said.
"I feel very happy to be part off it, I enjoyed it a lot. To qualify for the final in a match like this is amazing."
With 35-year-old Serena Williams facing her 36-year-old sister Venus in Saturday's women's final and a rested Federer, 35, waiting for Nadal on Sunday, it is the first time in the open era that all four finalists at a grand slam have been over 30.
Dimitrov, riding high on a 10-match winning streak and seeking his first grand slam final, did his best to keep the twentysomething standard flying into the weekend, firing 79 winners.
There were no signs of the mental frailties that have prevented Dimitrov from fulfilling the potential promised by his nickname "BabyFed" as he went blow-for-blow with the powerful left-hander.
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