Feliciano Lopez of Spain plays a forehand during mens singles first round match against Stan Wawrinka of Switzerland on day two of the 2017 Aegon Championships at Queens Club on June 20, 2017 in London.
Fourth seed Cilic, bidding for a repeat of the title he won in 2012, dropped serve for the first time all week but recovered quickly to win 6-3 5-7 6-4, ending veteran Muller's seven-match winning streak on grass.
Lopez capitalised on a run of Dimitrov errors at 5-5 in the first set to break before holding serve with ease.
A rain delay midway through the second set broke his rhythm though and sixth seed Dimitrov seized his chance to level.
Lopez was comfortably the better player in the decider, though, as he moved through to the final.
"It's a gift to be in this final again," Lopez, who looked close to tears at the end, told reporters. "I think the first set was the best I've played all week."
Lopez, Cilic and Muller had all reached the semi-finals without dropping serve, so it was a surprise when Cilic began to read Muller's swinging delivery early on and broke in the fifth game of the day's first semi-final.
Cilic wrapped up the opening set quickly and had he converted break points in the third or seventh games of the second set he would have spared himself any undue stress.
Instead, one lapse of concentration at 5-6 blotted his copybook to allow Muller to snatch the second set.
It was nothing more than an inconvenience, though, as Croatian Cilic broke in the seventh game of the decider and powered home to victory, sealing it with a second-serve ace on match point.
"Today's match was a really high level," world number seven Cilic, coached by former grasscourt specialist Jonas Bjorkman, said.
"I played really well throughout and Gilles was pushing me to the limits. I've felt really good on serve all week and today I was mixing it up and playing smart."
The one worry for the Croatian is that his doubles semi-final in which he was partnering Marcin Matkowski against Jamie Murray and Bruno Soares was not finished because of rain, meaning he faces a busy schedule on Sunday.