The world No. 1, who has claimed 15 titles in the last 16 months and is bidding for her ninth this season, will play second-seeded Victoria Azarenka, who defeated former world number one Jelena Jankovic of Serbia, 4-6, 6-2, 6-3.
Li ended in unfortunate fashion, double-faulting on a set point in the first and again on match point in the second.
Williams claimed her eighth win in nine matches against Li, who had not played in the previous round when opponent Agnieszka Radwanska withdrew to attend a funeral in her native Poland.
China’s former Roland Garros winner had a bad day on serve, double-faulting on a set point in the first set and ending the contest after 83 minutes with the same costly error on match point.
Williams has won 15 titles in the last 16 months including a personal-best eight in 2013. Her previous best in Cincinnati was a semi-final in 2006 when it was a smaller women’s-only tournament.
Williams also won the US Open Series title which gives her a chance at a one million-dollar bonus should she win the US Open which begins a week from Monday.
The American admitted to dealing with an abdominal muscle problem this week but did not go into details, saying she did not want to tape it for fear it might hinder her movement.
Meanwhile, Spain’s Rafael Nadal rolled over sixth seed Tomas Berdych 7-5, 7-6 (4) to set up a Cincinnati Masters final with John Isner.
Isner benefitted as Juan Martin del Potro double-faulted on match point to open the door to the unseeded American, who took full advantage by rallying for a 6-7 (5), 7-6 (9), 6-3 victory.
Nadal, seeded fourth, gave himself a chance at an ATP-leading ninth title of the season and his second in a row at the Masters 1000 level after his triumph in Montreal last week.
Nadal has defeated Isner three times without a loss.
Apart from six double faults in the second set, world number three Nadal had little to complain about in victory, his 52nd match win of the season.
He is unbeaten on hardcourts, having won the title at Indian Wells in March before his Montreal win.
Nadal came back 18 hours after beating Roger Federer in their marquee quarterfinal.
“I have adapted well here,” said the Spaniard. “I played a great match with Roger and today I felt I also played well, even if I was a bit streaky with the serve.”
“It was a challenge for me today. I never dreamed of this kind of a comeback,” said the player who is now in a position to move back to second in the world behind Novak Djokovic if he wins the trophy.
“It’s just unbelievable the way I have come back to be number one in the season points race. I missed the Australian Open, Miami and lost in the Wimbledon first round and still did it,” Nadal said.