Michael Batiste and Sani Becirovic top scored with 15 points each but it was the Greeks stunning defense which really won them the game with TAU"s superstars Igor Rakocevic and Luis Scola limited to just 10 points between them.
The victory was sweet revenge for Panathinaikos who lost to the Basque outfit in the same arena in Athens last year at the quarter-final stage to miss out on the Final Four in Prague.
With the two Serb coaches, Zeljko Obradovic of Panathinaikos and TAU's Bozidar Maljkovic, being the two most successful coaches in European basketball history it was always going to be a cagey contest – and that is exactly what developed.
Panathinaikos dominated the first half with some simply astounding defense which left TAU with a constant headache.
Each time the ACB side went forward they worked the ball around looking for an opening but none were to be found against such an air tight defense, and TAU were often forced into panicky shots as the shot clock expired.
The Greeks offense wasn't entirely clicking either but they got six big three pointers in the half to just one from TAU which helped them build up a healthy lead, they were 18-9 after one and then 35-21 up at the break.
Becirovic was perfect in that first half for Pana as he helped himself to 11 points, as TAU's big name players put up small time numbers.
TAU managed to scrape their way back into the game somewhat after the restart but they never found their rhythm on offense and it was more a case of Panathinaikos slowing down than them catching up which gave the Spanish a window of opportunity.
The gap was closed to 12 after three with score the on 47-35 and at that stage even the 18,000 strong crowd seemed to get a little tired after all their jumping around.
However, everybody was woken up a little by Turkish international Serkan Erdogan who started to find some holes in the Panathinaikos defense, and with the hosts offense basically just shutting down the gap was closed to just six points with four minutes to go.
However, in desperation, TAU then started to foul Panathinaikos players to try and extend the game, and the Greeks did enough at the line to pull away again, with Batiste really coming to the fore in the closing stages.
By the final minute the game was in the bag and the crowd started jumping up and down again as they looked forward to Sunday's final.
TAU had Scola foul out late on and he looked crushed by the defeat, but with just six points on the night, the Argentine could have no complaints, with Serb master Rakocevic only scoring four.
Batiste's 12 rebounds made him match MVP and if Panathinaikos can defend in a similar vein against CSKA on Sunday then they have a great chance of becoming European Champions for the fourth time in their history.