The fourth seed steamrolled the rising Canadian 6-2, 6-4 to continue her stellar form at Melbourne Park where she has now reached three finals, as well as another semi-final and the fourth round over the past five years.
After an agonising defeat to Victoria Azarenka in last year's decider on Rod Laver Arena, when she dramatically twice rolled her ankle and briefly blacked out, she is desperate to go one better.
"It is the third time, so pretty close to the trophy," the 31-year-old said, after teaching the ultra-confident Bouchard, 19, a tennis lesson.
"At least I'll try to not fall down this time, because last year in the final I think I played well but I only can say (I was) unlucky because I fell down twice."
Li's gutsy decision to get up and play on last year won her a new legion of fans in Australia, where she was already hugely popular due to her bubbly off-court persona.
Her French Open victory in 2011, the first singles Grand Slam title for an Asian player, helped popularise tennis in China. Li is also the figurehead for a push by women's tennis into the region.
She will go into Saturday's showdown a clear favourite against Cibulkova, the tournament's surprise package, who will be making her Grand Slam final debut after crushing fifth seed Agniezska Radwanska 6-1, 6-2.
The 20th seed was in inspired form against the Pole, who said she was exhausted after ending Azarenka's title defence in three sets on Wednesday.
It ensured Cibulkova not only made her first Grand Slam final in 26 attempts, but also goes down in the history books as the first singles player from her country to get so far.
"I had so many thoughts in my head (during the match) but just focused on my game. I can't believe I'm in a final," she said.
"Li is a great player, someone I really looked up to when I was a junior and I just want to go out there and enjoy it."
Li, who survived a match point in a tough third-round clash with Lucie Safarova, said she was glad to get past Bouchard and hopes her experience will pay off against Cibulkova.
"I've got more experience. Right now the final is special. The final is final, but it's still just one match," she said.
"So I still have to hit the ball to try to do my best. I cannot wait for my opponent make a mistake."
She put that experience to good use against Bouchard, who was playing her first Grand Slam semi-final at only her fourth attempt.
The Canadian, known as Genie, seemed overawed at the outset, losing her first three service games to love, before gaining confidence to make a match of it.
She leaves the tournament in high spirits after impressing with her composure and all-court game, but said she was disappointed to lose.
"I'm proud of how I've improved as a player throughout the tournament. But I'm never satisfied with losing. I'm always disappointed," she said.
"I wouldn't say I exceeded my expectations, but I'm happy with how I did.
"I always want to do better. To me it's not a surprise. I've been working hard my whole life to do this, play at Grand Slams and do well."
Radwanska was equally disappointed after freezing against Cibulkova.
It was another wasted opportunity for the Pole, who has now reached the quarter-finals or better in each of the last four years at Melbourne Park but failed to push on to the final.
"I felt like I was in slow motion today," she said. "I had a couple of tough matches, especially yesterday (against Azarenka). I think I was not fresh enough."