Grosso, who won the last-minute penalty that secured Italy's passage into the second round against Australia, went one better by firing a superb curling shot past Jens Lehmann at the end of extra time to give Italy the lead in the semi-final.
Though Alessandro Del Piero put the result beyond doubt in stoppage time, it was Grosso's eye for goal from his years as a winger that put Italy within reach of the final.
It also marked an astonishing rise in the game for a player whose career started with four seasons in amateur football, until 1998, and continued with another three in Italy's C2 fourth division with Chieti before ending up at Palermo.
The left back, widely tipped to join Inter Milan, told reporters: "When I saw it go in, it was such a big emotional rush - and I was glad to share it with all my team mates.
"I can't find the words at the moment. I'm very happy, as we all are. We're in the final. It's a dream, and bit by bit it's coming true.
GREAT EMOTION
"We're all hoping now that we can see it right through to the end.
"It's a moment of great emotion and great joy. We wanted to get to the final and we stood firm in a stadium which was a really tough place to play in and we were facing a really great side."
Grosso's goal capped a campaign which has been overshadowed by the scandal that has rocked Italian soccer and led to a state prosecutor on Tuesday calling for Juventus, AC Milan, Lazio and Fiorentina to be relegated from Serie A.
"We started this campaign with a thousand difficulties and now we're having a great tournament," said 28-year-old Grosso.
"We've reached an incredible finishing line. We're a great group of players and we deserve the satisfaction we've earned ourselves here.
"It was a great performance. We came close a number of times and defended in great style. Then, just when it looked as though it was heading for penalties, these two goals came along."
Grosso's impact at these finals follows a fine run with his Sicilian club, who he joined in Serie B from top-flight Perugia in 2003 and helped win promotion to Serie A.
Though Marcello Lippi did not include him in his squad for Euro 2004, Italy's coach will be very glad he did for Germany.
