British number two Aljaz Bedene was beaten 7-6 (7-5) 6-7 (5-7) 6-3 by Borna Coric in the Chennai Open semi-finals.
Coric, one place above Bedene at 44 in the world rankings, went 4-2 up in the first set tie-break and took it 7-5.
Bedene, who came from a set down to beat India's Ramkumar Ramanathan in the quarter-finals, led 4-1 in the second before eventually winning a tie-break.
Croatian Coric sealed the match in two hours 56 minutes and faces defending champion Stan Wawrinka in the final.
Slovenia-born Bedene needed treatment in the final set against Coric, who won their only previous encounter in Croatia last year.
Coric held serve in a 13-minute seventh game and then broke in the next to secure a key advantage.
World number four Wawrinka took just one hour and five minutes to oust third seed Benoit Paire of France 6-3 6-4 at the Nungambakkam Tennis Stadium.
Two-time Grand Slam winner Wawrinka is seeking his fourth Chennai Open title, following victories in 2011, 2014 and 2015.