Two long-range efforts from Bastian Schweinsteiger ensured hosts Germany overcame Portugal to claim third place.
The game will be remembered for Schweinsteiger's strikes
Germany took the lead when midfielder Schweinsteiger cut in from the left and drilled in a swerving shot.
The Germans went two up when the lively Schweinsteiger's free-kick was sliced into his own net by Armando Petit.
Schweinsteiger sealed the victory with another rasping shot from 25 yards and Nuno Gomes headed Portugal a late consolation after a Luis Figo cross.
Goalkeeper Oliver Kahn came in for his 86th cap, while Figo, who was rumoured to have had an argument with coach Luiz Felipe Scolari before the match, was relegated to the substitutes' bench.
The hosts started positively with Sebastian Kehl going close with a shot through a crowded box that appeared to strike Nuno Valente's hand, while Klose slashed a drive wide on the counter.
With only pride at stake, Portugal expressed the kind of freedom that has deserted their play in their previous two outings against England and France.
But apart from Pauleta's curling shot from close range and Kehl's deft lob, neither team could muster the enthusiasm needed to seriously trouble the opposing keeper.
The referee, who was officiating his first game for three weeks, made up for his inactivity by regularly awarding free-kicks for tame fouls.
But the quality of the resulting set-pieces were poor, with only Lucas Podolski's stinging left-foot strike causing any problems.
Luis Figo was brought on for his final cap by Luiz Felipe Scolari
Michael Ballack's yawn from the bench summed up the first 45 minutes, but his boredom turned to delight 10 minutes after the restart when Schweinsteiger unleashed a fierce drive from long range.
Portugal keeper Ricardo will have felt he could have done better with the shot that was driven straight at him.
And five minutes later Germany were two up, with Schweinsteiger again at the heart of the attack.
The midfielder's low free-kick cannoned off Petit as he tried to clear and ended up in the back of the helpless Ricardo's net.
On 76 minutes the disappointing Pauleta made way for Figo who won his 127th and final cap for Portugal.
But even he was unable to lift the despondent Portuguese and Schweinsteiger again found the net from outside the box with a sweetly-struck drive that gave Ricardo no chance.
Both Miroslav Klose and Podolski were then withdrawn, leaving France striker Thierry Henry needing two to tie and a hat-trick to win the Golden Boot in Sunday's final.
Figo's last act in his number seven shirt for Portugal was to lay on a goal for Gomes who headed in from close range.
But the night belonged to the hosts who deservedly claimed third spot to the delight of the home support and coach Jurgen Klinsmann.
Germany: Kahn, Jansen, Nowotny, Metzelder, Lahm, Schneider, Kehl, Frings, Schweinsteiger (Hitzlsperger 79), Klose (Neuville 64), Podolski (Hanke 71).
Subs Not Used: Asamoah, Ballack, Borowski, Friedrich, Hildebrand, Lehmann, Mertesacker, Huth, Odonkor.
Booked: Frings, Schweinsteiger.
Goals: Schweinsteiger 56, Petit 61 og, Schweinsteiger 78.
Portugal: Ricardo, Paulo Ferreira, Ricardo Costa, Meira, Nuno Valente (Nuno Gomes 69), Costinha (Petit 45), Maniche, Deco, Ronaldo, Pauleta (Figo 77), Simao.
Subs Not Used: Boa Morte, Caneira, Miguel, Paulo Santos, Postiga, Quim, Tiago, Viana.
Booked: Ricardo Costa, Costinha, Paulo Ferreira.
Goals: Nuno Gomes 88.
Ref: Toru Kamikawa (Japan).
Fifa man of the match: Bastian Schweinsteiger
This was Germany's third World Cup bronze medal. They have collected more than any other nation. Brazil, France and Poland finished third twice.
Bastian Schweinsteiger became the 15th player to score twice in a single match at the tournament. Petit's own goal was the fourth at the 2006 World Cup. The 1954, 1974 and 1998 World Cups also witnessed four own goals. Germany used 22 players. Only goalkeeper Timo Hildebrand did not feature. Argentina and Spain also used 22 players during the 2006 finals.
Costinha's yellow card was his fourth of the tournament, tying him with Ghana's Asamoah Gyan for most cautions received at the 2006 World Cup. The only other player ever to receive four yellow cards at a single World Cup was Bulgarian Zlatko Jankov in 1994. Portugal amassed a total of 24 yellow cards during the finals, breaking the record (23) that was held by Bulgaria since 1994.
Trivia stats source: Infostrada Sports