Jordan Morgan scored 15 points, and Nik Stauskas had 14 including a key free throw to help Michigan hold on for a 73-71 victory over Tennessee in Friday's first Midwest Regional semifinal in Indianapolis.
The second-seeded Wolverines now play 2012 national champion Kentucky on Sunday.
The Wolverines (28-8) led by 15 with 10:55 to go, but committed four turnovers in the final 97 seconds. Tennessee (24-13) cut the lead to 72-71 and had a chance to take the lead, but Jarnell Stokes was called for an offensive foul with 6 seconds left.
Stauskas then made 1 of 2 free throws and Tennessee's long desperation heave was off the mark.
Glenn Robinson III, a Lake Central graduate, added 13 points and five rebounds for the Wolverines.
Jordan McRae scored 24 to lead the 11th-seeded Vols.
For most of the first 36 minutes, Michigan was in firm control.
Then came a stunning turnaround by Tennessee, a bubble team that had to win a first round game just to get into the round of 64.
When Stauskas, the Big Ten player of the year, knocked down a 3-pointer with 3:37 to go, the Wolverines led 70-60 and looked like they would cruise.
Instead, Tennessee gave up just one more basket and steadily took advantage of Michigan's miscues. When McRae completed a three-point play with 1:56 left, the Vols trailed 72-67. Richardson's layup made it 72-69 with 24.6 seconds left and when the Wolverines threw away the ball on the next possession, McRae's layup cut Michigan's lead to 72-71.
Another turnover on an inbounds play gave Stokes the chance to put Tennessee ahead.
But Stokes, who contended he did not commit the foul, was called for the charge and the Vols' comeback was over.
Michigan should be getting used to these sorts of finishes in Indianapolis.
Two weeks ago when they were in Indy for the Big Ten tourney, the Wolverines had to hang on twice after seemingly having comfortable leads against Illinois and Ohio State. Eventually, they wound up losing to Michigan State in the title game.
Their inability to put a team away nearly did them in Friday.
Michigan St. 61, Virginia 59: Branden Dawson, a Lew Wallace graduate, had 24 points and 10 rebounds and Michigan State beat top-seeded Virginia to advance to East Regional final in New York.
The fourth-seeded Spartans (29-8) will play Connecticut (29-8) on Sunday with a Final Four berth at stake. The seventh-seeded Huskies beat third-seeded Iowa State 81-76 on Friday.
Michigan State overcame a horrible start to the second half and then withstood a late run by the Cavaliers (30-7) to advance to the regional finals for the eighth time since 1985 — all under coach Tom Izzo.
Joe Harris and Malcolm Brogden both had 17 points for Virginia, which became the second No. 1 seed to be eliminated, joining Wichita State.
These were the first NCAA tournament games played at Madison Square Garden since 1961.
Kentucky 74, Louisville 69: Aaron Harrison made a 3-pointer with 39 seconds left to give Kentucky the go-ahead points in a victory in the Midwest Regional over in-state rival Louisville.
Harrison, Julius Randle and Dakari Johnson, all finished with 15 points for the eighth-seeded Wildcats (27-10), who will play Michigan in Sunday's regional final.
Fourth-seeded Louisville (31-6) got 23 points from senior Russ Smith, who missed a late 3 with a chance to tie.
The Wildcats, who start five freshmen, led for a grand total of 65 seconds and took the lead for the last time when Randle found Harrison in the corner and Harrison spotted up and swished the shot for a 70-68 lead.
UConn 81, Iowa State 76: DeAndre Daniels scored 27 points, 19 in the second half, and UConn held off Iowa State to reach the East Regional final in New York a year after the Huskies were barred from the NCAA tournament.
Daniels hit his first six shots after halftime, the only Husky to make a field goal for over 8½ minutes. His 3-pointer gave seventh-seeded UConn a 49-32 lead.
The Cyclones rallied late, pulling within 67-63 with 2½ minutes remaining. But senior Niels Giffey hit a 3 in the corner for his first points since the game's opening moments, and when the Huskies (29-8) made their free throws in the final minute, the UConn fans packing Madison Square Garden could celebrate.
Dustin Hogue scored a career-high 34 points for third-seeded Iowa State (28-8), but Big 12 player of the year Melvin Ejim was 3 of 13 for seven points.
UConn will face top-seeded Virginia or fourth-seeded Michigan State on Sunday for a trip to the Final Four.
The Cyclones, in the Sweet Sixteen for the first time since 2000, were playing their second game without third-leading scorer Georges Niang, who broke his foot in their tournament opener.
Iowa State's Naz Long missed a 3-pointer with UConn clinging to a 70-65 lead and less than a minute left, and 6-1 Shabazz Napier pulled down the rebound and was fouled by Hogue. The senior calmly drilled both free throws.