City claimed a comfortable 3-0 win over Taiwanese club Taichung Blue Whale at AAMI Park on Sunday to go one step closer to claiming a treble.
Winning the competition also comes with a $1m prize packet that would deliver each player close to $50,000.
City next face South Korean club Incheon Red Angels, who beat Iran's Bam Khatoon 1-0 in their quarter-final.
The semi-finals and final will be held at an as-yet undetermined centralised venue in May, though it is unlikely to be in Australia. It will likely come mere days after City would potentially be involved in the A-League Women grand final.
ALW leaders City play Brisbane Roar at Perry Park on Wednesday, then will travel directly to New Zealand to play Wellington away at Porirua Park on Sunday.
"It's a huge step in the right direction for us," captain Rebekeh Stott said.
"Obviously, we've been working very hard and to get that result is massive.
"We've got a big game on Wednesday and then Sunday, so we know that we've got to put our heads down and keep working hard.Â
"But yes, we're going to enjoy this victory and look forward to getting into the semis."
City coach Michael Matricciani added: "We enjoy tonight and tomorrow we refocus and recover, get ready for Brisbane.
"Because we have a league campaign that we want to win - the minor premiership and the championship.
"After that, we'll change and refocus for the hub, and that's about a week after our (grand final), if we get there."
City will take 18 players on the road this week to allow for squad rotation.
On Sunday, the home side took the lead against Taichung from a corner in the fourth minute when Taylor Otto looped an athletic effort goal bound before Mariana Speckmaier made it a certainty by slamming the ball home.
City doubled their lead when Holly McNamara's cross deflected off Li Pei-jung and keeper Tsai Ming-jung could only knock it further into her own net.
McNamara won a penalty and converted it in the 63rd minute to decide the quarter-final, in front of 1865 fans at AAMI Park.
She came from the field following a right knee knock shortly after the goal.
Matricciani confirmed McNamara, who has overcome three knee reconstructions, was fine and was about to be substituted anyway to rest her for Wednesday.
"She got the pen, she got her goal so she's happy. Now we recover," he said.
Substitute Emilia Murray won another penalty in the 77th minute but Tsai saved Leticia McKenna's spot-kick.
"I would like to acknowledge that Melbourne City is a very, very powerful and strong team," Taichung coach Lu Kuei-hua said through an interpreter.
"The level of competitiveness, and also the quality is a whole different level compared to the (previous AFC) exhibition games. So it's a great experience for us."
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