Record Grand Slam champion Roger Federer set up an Australian Open semi-final with his great rival Rafael Nadal after beating Andy Murray in the last eight on Wednesday.

The Swiss sixth seed downed the Wimbledon champion 6-3, 6-4, 6-7 (6/8), 6-3 in three hours 20 minutes before tennis great Rod Laver on his namesake stadium.

Federer largely dominated the match and had two match points in a third-set tiebreaker, only for Murray to fight back and take the quarter-final into a fourth set.

Murray fought off six break points in a titanic 19-minute service game in the fourth set, but was broken in the eighth game when Federer volleyed into an empty court.

The 17-time Grand Slam champion then served out for the match, winning it on his third overall match point to set up a keenly awaited date with Nadal on Friday.

"It's really a big pleasure for me being back in the semi-finals. I think I've played semis here all the way since 2004," said Federer, who last won here four years ago.

"For me it's an amazing result for me again to be in the semis. This one feels different because of the tougher times I've had in (last year's) Slams, Wimbledon, at the US Open.

"It's nice to be back in the semis and defend my points from last year.

"It's nice to play in a nice tournament. Plus what I really love is another Swiss (Stanislas Wawrinka) is in the semis as well. It's the first time in history. So that's a big deal.

"For me it's a dream run as well and I hope I can keep it up against Rafa (Nadal)."

Following his victory, the Swiss legend is into his 11th consecutive semi-final at Melbourne Park. He has not lost before that stage since 2003.

Federer, who is in his first tournament working with Swedish six-time major-winner Stefan Edberg, looked mainly in confident touch and hit 54 winners with 42 unforced errors, along with four service breaks.

"I definitely think that's what I used to do so well, the transition game from defence to offence. I definitely sensed that today. I am back physically. I'm explosive out there. I can get to balls. I'm not afraid to go for balls," he said.

"I thought Andy did well, he kept the ball in play and put the pressure on me and unfortunately I couldn't get it done in the third set, with either the serve or the forehand missing. So I am happy to get the win in four," Federer said.