Top-seeded Nadal defeated Marin Cilic of Croatia 7-5, 7-6 (3) in the first semifinal, and second-seeded Federer was stretched to three sets before posting a 3-6, 6-3, 6-3 win over Juan Martin del Potro of Argentina.
Nadal, who won a tour-best sixth title of the season at the China Open last week, improved his current winning streak to 16 matches. The Spaniard, who has 16 Grand Slam men's singles trophies, won the French and U.S. Open titles this season.
Federer, looking for his sixth title this year, won the Australian Open and Wimbledon this year to increase his Grand Slam men's singles record to 19 titles.