The 34-year-old Swiss marvel carved up Czech rival Tomas Berdych in straight sets, 7-6 (7/4), 6-2, 6-4 in two hours, 16 minutes to set up a Thursday semifinal against world number one Novak Djokovic or Japan's Kei Nishikori.
Federer has now reached his 39th Grand Slam semi-final overall and believes he can add a fifth Australian Open title, even though his last Grand Slam success was back at Wimbledon in 2012.
"It means a lot. It's part of the reason why I'm still playing," Federer told reporters.
"I feel like I'm competitive at the top. I can beat all the guys on tour.
"It's nice now that in the last three Slams that I've been as consistent as I have been."
Federer said he was enjoying his tennis after adding former world number three Ivan Ljubicic to his coaching team, along with long-time mentor Severin Luthi.
"I'm playing good tennis, fun tennis for me anyway," he said.
"I really enjoy being able to come to the net more like back in the day.
"So I'm very pleased. It would mean a lot to me (to win more Slams), no doubt about it."
The world number three had few concerns against the strong-serving Berdych and extended his career record to 16-6 to deny the Czech a third straight semifinal appearance in Melbourne.
Lethal at the net
It was a convincing display from Federer, who broke Berdych's serve five times and dropped his own twice in storming to victory, watched by tennis legend Rod Laver on Rod Laver Arena.
Federer was lethal at the net, winning 24 of 29 points, while claiming ten from 12 serve and volley points.
"Tomas has caused me a lot of problems over the years and it's a pleasure playing against him," Federer said.
"He's got a lot of power. He knows how to do it. He's one of the guys that makes you play better, he's beaten me on some of the biggest courts around the world.
"I played a good match, I was aggressive, had some variety in there and it was quick conditions in the day session. I was very happy I was able to play this way."
Both players exchanged early service breaks and Berdych fought off a set point at 5-4 before the opening set went to a tiebreaker.
Federer dominated the tiebreak with a couple of aces and a beautiful backhand winner to have the Czech under pressure before taking the set in an hour.
Federer went straight after Berdych in the second set, breaking serve in the opening game and then again for 5-2 with Berdych running about the court in vain.
The Basel native got to two set points in his next service game and went two sets up with a forehand put-away to the open court.
Again both players exchanged service breaks in the final set and Federer fought off two break points at 3-2 before breaking Berdych at 4-4, and serving it out on his second match point with a smash set up by a wide serve.
Federer is 22-22 with Djokovic and leads Nishikori 4-2 in their previous meetings.