Henin, who knocked out Williams in the same round at both Wimbledon and the French Open, outslugged the eight-times grand slam champion before 23,000 in Arthur Ashe Stadium.
The top-seeded Belgian survived a set point at 5-6 before storming through the tiebreaker 7-3. Williams never recovered, falling behind 3-0 in the second set.
"I played a very good tiebreak," said a jubilant Henin. "I'm happy about my second set. I played much more aggressive and I took all the opportunities. I'm happy about everything tonight."
On the men's side, third seed Novak Djokovic advanced to the Open quarters for the first time with a 7-5 7-6 6-7 6-1 triumph over Argentine Juan Monaco.
Other fourth-round winners included former world number one Carlos Moya of Spain and Argentine Juan Ignacio Chela.
Henin's win levelled her career record against the double Open champion at 6-6.
She will now face either Serena's sister, 12th seeded Venus Williams, or number three Jelena Jankovic in the semi-finals of the year's final grand slam.
BLASTING ACES
"Playing Serena is so exciting for me," said Henin. "It was just fantastic. I'm so happy to be in the semis."
Williams served well, blasting four aces and landing 56 percent of her first serves. But hitting 28 unforced errors against only 17 winners was not effective enough to beat the world's top-ranked player.
Djokovic, 20, needed three hours and 53 minutes to subdue Monaco, a 23-year-old who had never won a match at Flushing Meadows before this year.
The 23rd seed Monaco played some inspired tennis, saving a match point in the third set before winning it 8-6 on a tiebreak.
Djokovic, however, played an aggressive 34-minute fourth set to gain a spot in the last eight. The hard-hitting Serb had 14 aces but 59 unforced errors in the winning effort.
"For me it was a bit surprising that he was stepping it up," said Djokovic. "He was staying close to the line and he was being aggressive. He tried to take over the control of the match.
"He made my points and games very, very difficult. So I had to fight for every point. And I had to stay right there with him, which I did in the end."
VERY MOTIVATED
Moya, 31, gained a spot in the last eight by surviving a courageous challenge from 19-year-old Latvian Ernests Gulbis to win 7-5 6-2 6-7 6-4 in two-and-a-half hours.
"These kind of matches, they're the ones that keep me very motivated," said Moya, who will face Djokovic in the quarters. "The (four-set) match I won the other day against (Philipp) Kohlschreiber, it's amazing.
"That feeling gives me 10 years more of my career. You're so happy when you finish that kind of match.
"Like today in such a great stadium, fourth round of a grand slam, still beating these young guys. These are the things that give me so much motivation to keep going."
Chela, the 20th seed, outlasted unseeded Swiss Stanislas Wawrinka 4-6 6-2 7-6 1-6 6-4 to reach his first Open quarter-final.
