The second seed arrived in Melbourne having not played a match since September because of a series of injury problems but has barely put a foot wrong all fortnight and is the only man not to have dropped a set.
That statistic was not challenged by Tiafoe, who was swatted aside 6-3, 6-4, 6-2 in only an hour and 47 minutes.
Nadal jokes with McEnroe in hilarious post-match interview
Nadal, who extended his winning streak over Americans to 21 straight matches, said: "For me it's very emotional to be back in the semi-finals in Melbourne. I had some troubles here in all my career, so to be back means everything to me. Of course I'm very happy with the way that I played tonight."
The 32-year-old has now dismissed two of the next generation in Tiafoe and Alex de Minaur, and must prepare for another one in Stefanos Tsitsipas.
"I said a couple of rounds ago that they can wait a little bit, but it looks like they don't want to wait," said Nadal with a smile.
Watch the moment Nadal sealed straight-sets victory over Tiafoe
"It's going to be a great year in terms of sharing generations. That makes this sport special."
He added of Tsitsipas: "He's a player that during the last year he has been improving every month. He's able to win against the best players of the world already. He's a great player.
"He's unbelievable today but he will have the chance to be one of the best for such a long time."
This has been a breakthrough slam for Tiafoe, who turned 21 on Sunday, but he was simply unable to match the relentless power and consistency of Nadal.
Frances Tiafoe succumbed to a straight-sets defeat at the hands of Nadal
Image credit: Getty Images
He had struggled physically during his fourth-round victory over Grigor Dimitrov, resorting to drinking pickle juice to try to give him energy.
His plan was to attack the Spaniard as early as possible in rallies, but, as countless opponents have found, that is much easier said than done and he was firmly on the back foot from the moment he lost his opening service game.
After dropping serve again at the start of the second set, Tiafoe had two chances to get back on level terms in the fourth game but could not take either and from there Nadal raced towards the finish line.