The USA's defence of their Olympic title was brought to an abrupt halt by Italy at Earls Court, going down 3-0.
Cristian Savani proved to be their Achilles heel, with USA's previously watertight defence breached 19 times by his thunderous hitting.
USA captain Clayton Stanley did his best to offer some resistance with 16 points, but it was not enough to rescue his team.
Italy's reward is a last-four meeting with 2008 silver medallists Brazil, who were comfortable winners over Argentina in the day's first game.
Italy coach Mauro Berruto said: 'I am extremely proud - especially in the pool matches, including against Bulgaria. I knew my team was coming out at the right time.'
Brazil progressed to the last four with a 3-0 win over Argentina, their victory underpinned by some typically brilliant defence from libero Sergio and achieved without captain Giba.
The 35-year-old national hero has been struggling with a knee injury and watched on from the sidelines as Murilo, Sidnei and Wallace carried the fight to Argentina.
Between them they contributed 37 points, with some thunderous blocks at the net - particularly from Wallace - helping to snuff out the danger of Pablo Crer.
Surprise package Bulgaria marched into the semis with a crushing 3-0 win over Germany, and they now have a last-four tie with Russia to look forward to.
Tsvetan Sokolov scored 22 points as his side dominated all over the court, shutting down Germany's Gyorgy Grozer at the net as they blocked eight times to three.
Russia were too strong for Poland in the last eight, clinching an impressive 3-0 victory.
Their serving was crisp, their reception accurate, their sitting quick and their hitting unstoppable. It was rare for a point to last longer than four strokes all night and fortunately for Russia, they were usually the ones playing the final shot.