Liverpool, trailing 1-0 from the first leg, drew level just before the end of the first half through Italian midfielder Alberto Aquilani's low curling shot from inside the box.
A quiet second half set up extra-time and the hosts took a 2-0 lead on the night through Yossi Benayoun's angled strike only for Forlan to smash home the ball a few minutes later. Though, Liverpool won the match 2-1, Atletico went through on away goals rule.
Atletico will meet Fulham in the May 12 final in Hamburg where they will bid to win their first major European trophy since the European Cup Winners' Cup in 1962.
Fulham, in the fourth tier of English soccer just 13 years ago, completed their fairy-tale run to the Europa League final with a 2-1 win over Hamburg SV at Craven Cottage.
Well-taken late goals from Simon Davies and Zoltan Gera on 69th and 76th minutes sealed a 2-1 aggregate win and a place in the May 12 final in Hamburg.
Earlier, Croatian striker Mladen Petric stunned the home side with a vicious 30-metre free kick after 22 minutes that Fulham keeper Mark Schwarzer could only watch as it sailed into his net.
The Spanish side Atletico, who face Sevilla in the King's Cup next month, also reached the European Cup final in 1974. "We have done really well," Atletico coach Quique Sanchez Flores told reporters.
Liverpool started with all the attacking intent Benitez wanted from a side including Steven Gerrard, Aquilani, Ryan Babel and Dirk Kuyt and they forced three corners inside the first two minutes to raise Anfield hopes.
However, the visitors have been dangerous on their travels and as Liverpool lost their passing game Raul Garcia tested goalkeeper Pepe Reina with a dipping shot that was turned around the post.
The hosts' inability to keep the ball up front frustrated the Liverpool fans but with halftime approaching Aquilani came to their rescue, stretching to meet Benayoun's cross and curl home a low shot.
A delightfully-chipped Lucas pass was met by Benayoun who finished well from a tight angle. Anfield went from raptures to stunned silence shortly afterwards when Jose Antonio Reyes easily beat Johnson to set up first-leg scorer Forlan, who smashed home from five metres for the decisive away goal.
