Cilic, the event's top seed, won the match by overcoming 24 service aces by the 6-foot-10 Karlovic.
His semifinal opponent Saturday, third-seeded Jurgen Melzer of Austria, rallied for a 3-6, 6-3, 7-5 decision against Ukrainian Illya Marchenko.
Elsewhere, Germany's Michael Berrer ousted fourth-seeded Viktor Troicki of Serbia 6-4, 6-3, while Germany's Philipp Petzschner had to rally before a 6-7 (1-7), 6-2, 6-2 victory against Slovakian Lukas Lacko.
Berrer and Petzschner meet in the other semifinal, and Sunday's champion will collect a $95,500 winner's check.
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