The second-seeded Australians advanced to a final for the first time since 2004 thanks to wins from veteran Sarah Fitz-Gerald and Kasey Brown, while England triumphed over New Zealand in a dramatic semi-final.
Fitz-Gerald got the ball rolling for Australia with a comfortable 11-5 13-11 11-7 win over Sharon Wee, before Malaysia levelled the contest when Nicol David beat Australia's Rachael Grinham 11-8 11-5 11-5.
However, Australia were not to be denied, with Kasey Brown putting on a show, dominating Delia Arnold 11-6 11-3 12-10 in a powerhouse performance.
Australia will face England in a battle between the two most successful teams in the history of the championships.
England progressed in tense fashion, downing the host nation 2-1 with Laura Massaro fighting back from two games down in the decider to win her match with Joelle King 5-11 7-11 11-7 11-2 11-7.
"I just thought `dig in, keep the rallies long and just do the best that you can' and that's all that anyone in my team expects me to do," Massaro said.
"I think I did that in the last three games."
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