The American held a 5-0 record against Radwanska coming into the match, but the Pole surprised the 16-times grand slam champion by being aggressive and not mixing up her shots.
"It was really close and I had my chances but wasn't really taking them," Radwanska told reporters. "It's always turning against me, especially when you play a top player.
"I was really trying to play aggressive and going forward, but she's really playing deep and strong balls. It's really hard to do anything."
Williams broke Radwanska at love to go ahead 5-4 in the first set with a heavy forehand crosscourt winner, but then was broken back at love herself when she double faulted.
Both women held to go to a tiebreak which Williams dictated and sealed it 7-3 with a forehand volley winner and big ace down the T.
Williams called the trainer in between sets for a stomach problem but said that it did not affect her play as Radwanska broke to take a 2-1 in the second set when she forced the American into a backhand error.
Radwanksa, however, could not maintain her advantage, as Williams picked up the pace, breaking back to 3-3 with a booming overhead.
While the Polish world number four is faster than Williams, the American stayed in most of their long rallies and serving at 4-4, she fought off a break point with a forehand crosscourt winner and then held in a long point that ended with her ripping a forehand down the line.
Williams broke Radwanska to win the match with a backhand winner and another forehand blast.
"I really tried to be more aggressive towards the end," said Williams. "I don't think I played my best, and I always knew that, worst"‘case scenario, I could do a little better."
BEST RUN
Williams will now face the unseeded Cirstea who has put together the best run of her career, beating two former top ranked players in Caroline Wozniacki and Jelena Jankovic, and then two former grand slam champions in Petra Kvitova and Li.
"If I want to win this, I have to step it up," said Cirstea. "I had to win it on my terms."
The 23-year-old Cirstea was by no means perfect in the semi-final, but was resourceful and did not implode when the pressure was on.
"I think that's a big change for me," she said.
"Before, I would get down on myself, while now I just try and focus every single point and I don't care so much what's just happened in the past."
Cirstea raced through the opening set in just 21 minutes as Li, last year's Rogers Cup finalist, was wild and inconsistent.
But the former French Open champion picked up her game in the second set, breaking Cirstea to lead 3-1 when the Romanian dumped a backhand into the net.
Li fought off three break points in the next game and appeared to have control of the set when Cirstea sought advice from her coach Darren Cahill.
Cirstea broke Li when she was trying to serve out the set at 5-4 then broke her again to snatch a 6-5 lead.
Although she failed to serve out the match herself, squandering two match points, then fell 4-1 behind in the tiebreak, she regained her composure as Li started to falter, handing victory to Cirstea on a double-fault.
"She's got a lot of confidence now," Li said.
"Sometimes I was feeling she couldn't hit a winner, but the ball came to you as a winner. It's very tough."
(Editing by Julian Linden/Greg Stutchbury)
