The Spaniard, 30, won 6-2 6-4 to claim his first victory over the Serb since the 2014 French Open final.
Nadal improved his record on clay this year to 14-0 and will face Austrian Dominic Thiem, who beat Uruguay's Pablo Cuevas 6-4 6-4, in Sunday's final.
Kristina Mladenovic plays Simona Halep in Saturday's women's final.
Nadal confirmed his return to form with a long-awaited win over Djokovic, his 24th in 50 career meetings.
