The eighth seed triumphed after a pulsating five-set quarter-final which ran for exactly four hours and finished 2-6 6-4 6-2 3-6 9-7 when Djokovic volleyed out on the first match point. (Agencies)
It was a personal triumph for Wawrinka, 28, who took Djokovic the distance in last year's fourth round and was also denied by the Serb in another five-setter at the US Open.
Wawrinka's win halted Djokovic's 25-match winning streak at the Australian Open, which stretched back to 2011 and included 2012's record, six-hour final against Rafael Nadal.
It also snapped the six-time Grand Slam champion's sequence of 14 straight major semi-finals, and broke a 28-match unbeaten run dating back to the US Open final in September.
"Last year (at the Australian Open) I didn't finish it and it was really tough. But this year I came back, it's a new year and I was feeling really good," Wawrinka said.
"I tried everything, he's an amazing champion...I'm really, really, really, really happy."
Wawrinka, who was cramping by the end and headed straight for an ice bath, goes into his second Grand Slam semi-final where he will face Tomas Berdych after the Czech ousted third seed David Ferrer.
Li Na blazed past Flavia Pennetta to set up a last-four clash with emerging teen star Eugenie Bouchard, 19, who beat former world number one Ana Ivanovic.
But the earlier results were eclipsed by Wawrinka's great upset which ensures that a player from outside of the men's "Big Four" will contest the Melbourne final.
Djokovic bombed through the first set in just over half-an-hour but he stumbled in the second, and looked increasingly tight in the third, as Wawrinka took a two-sets-to-one lead.
The eighth seed triumphed after a pulsating five-set quarter-final which ran for exactly four hours and finished 2-6 6-4 6-2 3-6 9-7 when Djokovic volleyed out on the first match point.