Former world number one Roger Federer produced some magical moments, but that wasn't enough to prevent a fourth loss in his last five matches to the fast-improving Andy Murray here on Friday.
The world number four next takes on the top-ranked player in the world, Rafael Nadal in the final after the Spaniard's explosive powerplay proved to hot for Russian world number five Nikolay Davydenko to handle. Nadal won 6-2, 6-3.
The winner of the Nadal-Murray final takes home the entire purse of $250,000 in the shootout tournament.
Murray, who seemed in pain and clutched his back after the second set, said:
"It's always a challenge playing Roger. I've got the better of him on a few occasions, but in the big one we played, at the US Open final, he beat me pretty badly. Hopefully, I'll get him in a Grand Slam one day.
"It will be nice to become the number one player in the world, but my aim for 2009 is to win a Grand Slam event, and I feel the Australian Open is my best chance. So, this is a really nice preparation for that."
Nadal also revealed his ambitions for 2009, saying: "The aim really is to be a better player than I was last year and to keep improving. Obviously, I like the position I am in right now and would like to keep it this way as long as possible."
On his match against Davydenko, the Spaniard added: "I have been working hard on my game lately even though I haven't been playing competitive tennis for the past two months or so. I was delighted with the way I played today and am looking forward to the rest of the season."
Federer began well, racing to 3-0 in the first set. Murray broke back in the fifth game when the Swiss maestro twice failed to pull of easy drop shots on the net. A double fault by Murray on break point in the 10th game sealed the set for the 13-time Grand Slam champion.
Federer struggled at the net and with his forehand shots in the second set, which was easily won by Murray, who then raced to a 4-1 lead in the third.
It was then that Federer turned on his magic. Suddenly, it looked like he could do no wrong. Some lethal serves and blistering returns saw him win the next four games in nine minutes.
However, Murray held on to his serve in the 10th game and pushed the set into a tie-breaker, where several Federer unforced errors gave him three match points at 6-3.
The Swiss star saved all three match points, but two more unforced errors ensured the result in favour of the Scot.
Federer, who won the US Open last year, said: "It was quite a good start to the year, but I just could not pull through. Andy has been playing some very good tennis and he carried his form from the end of last year."
In the other semi-final, Davydenko started in brilliant fashion by breaking Nadal in the first game without giving him any point.
But Nadal regrouped within no time and completely dominated the Russian to take the first set 6-2.
In the second set, Davydenko broke Nadal in the first game again, but the reigning French and Wimbledon champion broke right back. Another break in the sixth game and it was all over for Davydenko.