Two early goals secured Millwall a place against Sunderland in their first FA Cup semi-final for 67 years.
Tim Cahill tidily finished past John Achterberg with his left foot after flick-ons from Paul Ifill and Danny Dichio unlocked the Tranmere defence.
Neil Harris doubled their advantage with a spectacular 20-yard volley after Dichio guided the ball into his path.
Gary Jones' header pulled one back before half-time but Millwall held on to win a tightly-contested replay.
Dennis Wise's team will now meet Sunderland at Old Trafford on 4 April for a place against either Arsenal or Manchester United in the FA Cup final.
With either of their prospective final opponents likely to qualify for European qualification via their final Premiership position it means Millwall are realistically just one match away from securing a place in next season's Uefa Cup.
Both teams had good news prior to kick-off, with Sean Connelly and Ian Goodison returning for Tranmere and Millwall's Darren Ward declared fit to play after a pain-killing injection on his knee.
11 mins: Cahill opens the scoring
16 mins: Harris scores a spectacular second
41 mins: Jones pulls one back
But it was Millwall who made the early running, scoring with the first real opening of the match.
A long ball up-field was flicked on by Ifill and then Dichio into the patch of Cahill, who controlled superbly before hooking the ball past Achterberg from 18 yards.
Millwall doubled their lead with their next attack thanks to Harris' spectacular strike.
Dichio almost made it three as Millwall threatened to wrap-up the replay within 20 minutes, but his header from a raking cross was parried across goal and away by Achterberg.
Tranmere, in contrast, created precious little until the 28th minute.
Ward fouled Gary Jones in a dangerous area but Taylor's free-kick struck the Lions wall and deflected out for a corner.
Tranmere continued to try and push forward but struggled to get behind the Millwall defence until Iain Hume's skill and persistence finally paid dividends after 41 minutes.
Hume seemed to have few options available but jinked and weaved to the byeline before crossing from the right for Jones to head beyond Andy Marshall.
Dichio headed goalwards moments before the break but Achterberg comfortably saved.
The Millwall striker peeled away from Ian Goodison and headed goalwards at the far post minutes into the second half but was again denied by an acrobatic Achterberg save.
A Tranmere corner caused chaos in the Lions area after 59 minutes as the home team desperately tried to find an equaliser.
A snapshot from Gareth Roberts deflected out for corner and David Beresford shot over from long range as the passionate home crowd tried to lift Rovers.
Another desperate Tranmere effort almost produced an equaliser.
Millwall struggled to clear their lines and the ball broke to Dadi, whose 18-yard-strike wrong-footed Marshall but drifted agonisingly wide of the post.
Wise withdrew Ifill and Dichio as he opted to defend his lead and the Lions held on for an historic victory.
Tranmere: Achterberg, Connelly, Allen, Goodison, Taylor,
Roberts, Harrison, Mellon, Beresford (Dadi 73), Jones, Hume.
Subs Not Used: Howarth, Sharps, Loran, Nicholson.
Booked: Jones, Hume.
Millwall: Marshall, Muscat, Lawrence, Ward, Ryan,
Ifill (Elliott 77), Cahill, Livermore, Roberts, Harris,
Dichio (Sutton 82).
Subs Not Used: Gueret, Sweeney, Dunne.
Booked: Muscat, Livermore, Sutton.
Referee: U Rennie (S Yorkshire).