Clarence Seedorf and Pippo Inzaghi conquered Munich to send Milan through to face Manchester United in the Champions League semi-finals. Bayern had not lost a knockout round on home turf since losing to Red Star Belgrade in 1991.
The Rossoneri needed a win or to draw while scoring at least three goals in Munich after twice throwing away a lead to draw 2-2 at San Siro. With Alberto Gilardino suspended, Ronaldo and Marco Borriello cup-tied, Pippo Inzaghi fought off injury worries to start against a club he has already put five goals past in his career. Bastian Schweinsteiger and Willy Sagnoli were sidelined, but Mark Van Bommel
and Oliver Kahn returned from their bans.
Sir Alex Ferguson was in the stands to view the side his Manchester United would face in the semi-finals.
Bayern almost took the lead after just seven minutes, as Cristian Lell's volley with the inside of his foot at the byline looped over Nelson Dida for a decisive Massimo Oddo goalline clearance.
Moments later Inzaghi sprung the offside trap on Paolo Maldini's ball floated over the defence, but his first touch let him down. It was a very open game and on 12 minutes Dida parried a Lucas Podolski angled drive from eight yards with his legs.
Inzaghi couldn't get enough power on his looping header after good work down the left from Clarence Seedorf and Marek Jankulovski.
Milan took the lead just before the half-hour mark. Andrea Pirlo won the ball back in midfield and Kaka rolled across to Seedorf, as the Dutchman found space with a dummy to thump his right-foot strike beneath Daniel Van Buyten's body into the far bottom corner.
Inzaghi's header looped over, but soon after he made it 2-0. A splendid Seedorf backheel flick sent Pippo clear from the static Bayern central defenders with a very tight onside decision and Inzaghi smashed his shot home into the roof of the net from the edge of the area. It was the sixth time he has scored against Munich.
Milan were now dominating in midfield and Bayern tried to get back into it from a set play, as the free kick fell kindly for Podolski from four yards, but Dida was attentive and blocked. At the other end Kaka spun on the edge of the box, but his pass to Inzaghi was intercepted when he perhaps should have gone for goal.
In stoppages Kaka and Inzaghi wasted a golden opportunity on the counter-attack, as both had their shots charged down.
Bayern boss Ottmar Hitzfeld introduced striker Roque Santa Cruz for Ottl in the second half, but Van Bommel was booked for an elbow on Massimo Ambrosini.
Gennaro Gattuso performed a splendid last-ditch tackle to stop future Juventus man Hasan Salihamidzic inside the box. Oddo prevented Salihamidzic from volleying in a Lell cross, although the ex-Lazio defender's clearance was somewhat scuffed.
Van Bommel drilled wide from 30 metres, although Dida had the angle covered, and Claudio Pizarro replaced Roy Makaay. Van Bommel was more accurate a few minutes later and this time stung Dida's palms.
Alessandro Nesta came racing across to tackle Salihamidzic in the area, but the Bayern man kept going after the ball had been lost and stamped on the Italian's thigh. The referee showed Salihamidzic the yellow card and a scuffle broke out betwee Ambrosini and Lell, Ancelotti dragging his midfielder away to calm the waters.
Kaka was having a terrible game and when Inzaghi sparked the counter-attack, the Brazilian shook off two tackles, but had his effort charged down rather than pass to the totally unmarked Seedorf.
Bayern were desperate and a chaotic move on 67 minutes had several different shots charged down, with Podolski in particular wasting the chance from point-blank range.
Ancelotti's men were under pressure, so he replaced the not 100 per cent fit Inzaghi with Serginho in a more advanced role, going for pace to strike on the counter and no pure strikers.
Van Bommel's effort was deflected over and Serginho's pass to Kaka was intercepted when it was two v two. Salihamidzic's strike on the bounce was well held, as was a Pizarro looping header.
Yoann Gourcuff came on for the tired Seedorf and Van Bommel had another low drive deflected past the near post off Nesta and Pizarro hit the side-netting from six yards.
Gattuso made way for Marcos Cafu in the final moments at the AllianzArena, but the Brazilian was stopped on a classic stoppage-time counter by his fellow countryman Lucio when the Bayern defender was last man.
There was one final scare with Dida's fantastic reaction save on a Van Buyten volley.
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Bayern Munich: Kahn; Salihamidzic, Lucio, Van Buyten, Lahm; Ottl (Santa Cruz 46), Hargreaves, Van Bommel, Lell (Gorlitz 77); Makaay (Pizarro 61), Podolski
Milan: Dida; Oddo, Nesta, Maldini, Jankulovski; Gattuso (Cafu 87), Pirlo, Ambrosini, Seedorf (Gourcuff 80); Kaka; Inzaghi (Serginho 70)
Ref: Mejuto Gonzalez (Spa)