Nowitzki scored 12 of his 31 points in the fourth quarter in the seventh game of the first-round series.
The Mavericks moved into the second round for the third straight year. For the second straight year, they will face the Sacramento Kings, who eliminated them in five games last year. Game 1 will be Tuesday night in Dallas.
It was a nerve-wracking series for the Mavericks, who were on the verge of a sweep after winning the first three games, then on the verge of the biggest collapse in NBA history after losing the next three.
"I know nobody's ever done it before and I suppose we didn't want to be the first ones," Dallas coach Don Nelson said. "But what are you going to do about it?"
"I know a lot of people didn't believe that we could come back and win three games," Portland Coach Maurice Cheeks said. "We really believed we could win this seventh game."
Nowitzki had been the leading scorer in the playoffs until Game 6, when he scored just four points while making two of 11 shots in a 125-103 loss. The versatile 7-footer bounced back with a big game that cemented his status as a superstar.
"We knew our energy wasn't there in the last three games and that's where we had to pick it up," Nowitzki said. "We had to be more physical in the paint and rebound the ball."
In his first career Game 7, Nowitzki made 12 of 21 shots and grabbed 11 rebounds, helping Dallas to a 42-42 deadlock on the boards.
The game was tied at 93-93 when Nowitzki scored seven straight points for Dallas in a 90-second stretch, creating a 100-94 lead with 1:21 to go.
"It was such a big game," Nowitzki said. "It was one of the biggest games of our careers."
"His confidence right now is sky high and in the fourth quarter, his eyes just lit up," Dallas guard Nick Van Exel said.
Van Exel's eyes lit up a bit as well. He kept alive the offense in the first half and scored 12 of his 26 points in the final period.
But what may have fully awakened Dallas was the words of Portland forward Ruben Patterson, who after Game 6 said, "I think they're a little scared now, they've got their backs against the wall."
"Thank you, Ruben, for being dumber than a rock," said Nelson, who added that he did not even give his team a pregame speech. He left that to veteran guard Avery Johnson, who is not on the playoff roster.
"I had Avery do my talking because he said it in our coaches meeting better than I could," He did a marvelous job giving a talk to the team. I didn't do too much at all."
Rasheed Wallace and Damon Stoudamire scored 17 points for the Blazers, who were the third team to force a Game 7 after losing the first three. But, like the 1951 New York Knicks and 1994 Denver Nuggets, Portland could not break through.
"It's a disappointment, but the last five or six days have been fun," Stoudamire said. "I think it showed a lot about this team, the heart that we have."
The Blazers took a 73-71 lead into the final period, but nine points from Van Exel gave the Mavs an 82-78 advantage with 8:06 to go.
"The guy that hurt us was Van Exel," Stoudamire said. "If Van Exel didn't play the game he played, we would be talking about us winning the game."
Wallace took charge, scoring Portland's next 12 points. His second three-pointer of the surge gave the Blazers a 90-88 edge with 4:42 remaining.
Nowitzki tied it with a jumper and Van Exel threw in a long three-pointer to reclaim the lead for Dallas.
Scottie Pippen tied it with a three-pointer with 3:17 left, but the Blazers did not score from the floor again.
Nowitzki began his decisive push with a pull-up jumper, giving the Mavs the lead for good at 95-93 with 2:51 to go.
After an offensive foul on Arvydas Sabonis, Nowitzki tracked down a miss and scored inside. Patterson was fouled, but split the pair with 1:36 to play, and Nowitzki delivered the dagger with a three-pointer at the 1:21 mark, opening a 100-94 lead.
"I don't really see myself as the only leader on this team," Nowitzki said. "We have a lot of offensive weapons. Whoever has the hot hand will take over at the end of the game and take the big shot."
"Their guys that were supposed to make shots, made shots," Cheeks said. "That was Nowitzki, Van Exel. They all stepped up and made shots."
Sabonis had 16 points and eight rebounds and Zach Randolph added 14 and 10 for Portland, which shot 43 percent, including nine of 19 three-pointers.
Stoudamire made five shots from the arc, including four in the first half, when the Blazers managed a 45-45 tie even though Wallace and Bonzi Wells went scoreless.
Patterson scored 12 points and Wells added 11 for Portland, which has gone out in the opening round three straight years.
"We hate to lose that series, but it was a heck of a series," Cheeks said.