Brazil went ahead in the 18th minute in Belo Horizonte on Saturday when Gonzalo Jara appeared to flick the ball into his own net under pressure from David Luiz following a corner, but Alexis Sanchez's equaliser just after the half-hour mark proved enough to take the game to extra-time as both sides were made to rue missed opportunities.
Mauricio Pinilla almost won it for Chile in the closing stages but his effort struck the crossbar and kept the scoreline at 1-1, leaving Brazil to win it 4-3 in a penalty shoot-out courtesy of successful spot kicks from David Luiz, Marcelo and Neymar.
Jara hit the post with the crucial penalty for Chile, who had already seen efforts from Pinilla and Sanchez saved by Cesar, and the Brazil goalkeeper could barely hide his emotions after the game.
"I gave an interview four years ago and I cried (when Holland eliminated Brazil)," he told Sportv. "I was very sad but now I am crying because I am happy.
"Only God and my family know what I went through and I still do. My team-mates gave me a lot of support to do my best. I hope to give more interviews like this, this is my dream."
Thiago Silva was rather more struck for words but revealed Cesar had been in confident mood beforehand, adding: "It's impossible to translate this into words, a unique moment in our lives. Before the penalties, Julio (Cesar) told us to be confident on penalties because he would save three penalties."
David Luiz had been struggling to shake off a back problem ahead of the game and the Paris Saint-Germain new boy admitted he was feeling the pain before taking his spot kick.
He said: "I first have to thank God for everything He has done in my life, I have to thank my family and everyone who encouraged me to deal with today's challenge and I have to thank my team-mates, Scolari, Runco and the rest of the medical staff that believed in me.
"They saw me in training that I couldn't even walk. When I took the penalty, it was the most pain I had I felt, but I told them (before the game) that I wanted to play, that I would do anything to play. I treated (my injury) for two days without stop."
Brazil coach Luiz Felipe Scolari admitted his side had been tested to the limit.
"This was expected," he said. "We had expressed the feeling seven to eight months ago when we heard the draw, that we'd have trouble.
"It was a very balanced game, although we conceded a goal due to something that's not acceptable at this level. We had equal possession and attempts."
"Will it be we have people dying of heart attacks? It depends on your medical check-ups! It's a very emotional World Cup."
When asked whether he expected to face Colombia or Uruguay, he added: "We don't know who we are going to face next. They have different styles."
As for poster boy Neymar making a impact on the match, Scolari added: "Neymar is 22 but he has the experience of a 35-year-old. Psychologically and mentally, he is very prepared."
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