The Serbian was in irresistible form as he swept aside the fourth-seeded Spaniard 6-2 6-2 6-1.
He goes into Sunday's final against either Roger Federer or Andy Murray knowing a win will see him make history as the first man in the Open era to win three Melbourne titles in succession. Federer and Murray's game begins on Friday morning
And on this evidence few would back against Djokovic.
"It can only do positive things for my confidence," said the world number one following his 89-minute masterclass.
"Playing against the world number four and someone I have great respect for... and to be able to play as well as I did was incredible.
"This was definitely one of the best performances of my career."
Asked if he can play better, he said: "I don't think so, I played incredible tennis.
"I felt very comfortable and very confident from the start.
"I don't expect myself to always play this well. But hopefully I can maintain this level in the final."
The five-time major winner will head into Sunday's showdown in better shape than last year when he had to battle through an epic last-four clash with Murray before going to on to beat Rafael Nadal in a final which lasted seven minutes short of six hours.
He added: "I prefer being fitter for the final (this year) than I was in 2012.
"It's quite different circumstances that I have to face this time."
Ferrer is regarded as one of toughest players on the ATP Tour to break down, yet he was swept aside by the world number one who was on top of his game from the outset.
Blazing winners from all angles of the court, he made the fourth seed look like an also-ran.
The Serbian broke twice in the first set and maintained his level at the start of the second by establishing a 3-1 lead.
Ferrer looked like a rabbit trapped in the headlights and double-faulted at break point to hand his opponent a 4-1 advantage.
Djokovic served it out, helped at 5-2 by a wonderful backhand winner which had the crowd on Rod Laver Arena gasping.
It seemed his level had to drop; instead, he got better.
He came out on top in a 32-point rally to set up another break at the start of the third and was by now in full flow, two more crushing backhands extending his advantage to 3-0.
Ferrer hit back from two sets down to beat Nicolas Almagro in the previous round but there was never any chance of a repeat as Djokovic broke once more to win a one-sided match.
Ferrer was typically gracious in defeat.
He said: "He played very well tonight. Novak was better throughout.
"I got to the semi-final and it was a good three weeks. I am happy with that but not happy with my game tonight."