The Spaniard's right knee flared up in the second set of his 7-6 (2), 7-6 (2) victory over Karen Khachanov in Friday's quarter-finals.
"I wanted to try my best to be competitive today", he said.
"Still tough because I felt more or less OK during this beginning of the season in terms of my knee", he said.
Seventh-seeded Thiem was a 7-6 (7-3) 6-7 (3-7) 6-4 victor over Milos Raonic in two hours and 31 minutes to reach his third ATP Masters 1000 final.
Thiem, who advanced to the semis on a walkover when Gael Monfils withdrew with a Achilles tendon inflammation, was locked-in from the start, firing 10 winners without an unforced error in the opening set. He led 5-3 and served it out, winning on his second match point with a backhand volley. The first semifinal begins at 2 p.m. EST.
"It was an incredible day", said Thiem, who will be playing in his third Masters 1,000 final.
His run at the first Grand Slam of the year marked his return to competition for the first time since a similar knee problem forced him to retire from his US Open semi-final against Juan Martin del Potro in September.
Thiem and Federer have split their four previous meetings, with only one going three sets.
"We've had so many epic battles", Federer, 38, said. "I know the anticipation is there from the crowd and also us players". "I'm very excited to be in the semis here, not that I didn't expect it".
"If I play Rafa there's extra energy in the building - there's always a lot on the line", he said.
After his win over Khachanov, Nadal told reporters: "I love to play on hard [courts], but probably my body doesn't love it that much".
"You look back at what I did well there, but you can't just copy-paste and play exactly the same thing again", Federer said.
Nadal remains without a title since Toronto in August past year and a win over Federer since the Australian Open in 2017 but with a four-week break he will re-emerge for the clay-court season in Monte Carlo before yet another French Open at Roland Garros.
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