Anthony Grundy scored 24 points and North Carolina State overcame some dreadful foul shooting down the stretch to surprise the Terrapins in the semifinals, 86-82.
The third-rated Blue Devils then fought off an another upset bid by pulling away in the final stages to eliminate Wake Forest, 79-64. Mike Dunleavy scored 18 points and Carlos Boozer added 17 for Duke.
A final between Duke and Maryland had been expected after the teams had split their regular-season games. Instead, Maryland must now be concerned about its seeding in the NCAA Tournament, which could have slipped from a No. 1 to a No. 2 with the loss.
In the day's second game, Darius Songaila scored 16 points and Broderick Hicks added 14 for the Demon Deacons (20-12), who suffered their 13th straight loss to Duke.
Julius Hodge made a pivotal three-pointer for North Carolina State (22-9) in the final moments as the Wolfpack continually fought off Maryland comeback attempts.
"To come away with the win today, our guys really put some things together and hung out there at the end," North Carolina State Coach Herb Sendek said. "I am really proud of them."
The loss snapped a 13-game winning streak for the Terrapins (26-4). Maryland was the ACC regular-season champion, but once again came up short in the tournament. The Terrapins have not won the event since 1984.
"We had looks to tie the game and they made some pretty tough shots," Maryland coach Gary Williams said. "I'm proud of what we've done this year and winning the regular-season championship. I really believe we deserve a No. 1 seed off of what we've done to now be 26-4."
Steve Blake had 21 points and 11 assists and Chris Wilcox and Lonny Baxter 15 points each for Maryland. Juan Dixon, Maryland's most consistent performer, had just 13 points and made just six of 16 shots.
"This loss is very disappointing. One of our goals was to win the ACC Tournament and we didn't do that," Blake said. "But we'll put it aside soon as we find out who we are playing in the NCAA Tournament and we'll be ready for that team."
Marcus Melvin had 19 points and Archie Miller 16, including 11 in the second half, for the Wolfpack.
Miller scored seven points in a 12-2 run to give the Wolfpack a 79-66 lead with 3:56 remaining. But the Terrapins did not quit and the Wolfpack suddenly went cold at the line, missing eight of their last 11 shots.
Blake made three free throws to cut the lead to 81-78, but Hodge, who had 14 points, responded with a three-pointer as the shot clock expired to give the Wolfpack a six-point cushion.
"We were missing some free throws down the stretch and Julius stepped up and made a great shot," Sednek said. "Sometimes great players do that. He's made big baskets and big plays for us all season."
Maryland later cut the lead to 85-82 on a basket by Juan Dixon with 39 seconds left and regained possession following a turnover by Grundy.
Drew Nicholas missed a 3-pointer, yet the Terps had another chance when Grundy missed a pair of free throws. But Dixon missed a long three-pointer to end Maryland's last chance.
"We felt like we always had the confidence to do it," Grundy said. "It's just a matter of us going out and doing it on the court."
North Carolina State, which lost its last six meetings with Maryland, built a 24-12 lead. The Terps answered with a 19-2 run capped by a pair of fast-break layups by Blake.
The Wolfpack led at the intermission, 40-38.