Spaniard Nadal, an 11-times Grand Slam champion, suffered a surprise defeat to world number 73 Horacio Zeballos last week after reaching the final in Chile.
That was his first tournament since a knee injury ruled him out of the US Open and Australian Open last year, but the world number five now has another chance to claim a confidence-boosting title at the Brazil Open.
Lucky loser Alund, 27, is ranked 111th in the world and had never won a main tour level match before this event.
The Argentine was in the form of his life though, and even took the second set off Nadal after a tie-break.
"After being out for seven months, if the knee isn't good and I can reach two finals, that can only be positive," he said.
"Physically, I am prepared. I don't know (whether) the knee is prepared," he added with a smile.
Nadal will face David Nalbandian in Sunday's final after he beat Simone Bolelli 6-3 7-5 to move into his first title match since his remarkable implosion at Queen's last year.
Nalbandian served up 11 aces in his clash with Italy’s Bolelli, winning most of his first-serve points despite only landing just over half of them in.
The clean-hitting baseliner’s return game was exceptional, winning just under half of his points against the first serve and a whopping 70 per cent when facing the second serve.
Bolelli, meanwhile, failed to save a single one of five break points faced, double faulting on as many occasions.
The 31-year-old has an 11-12 career finals record and is through to a clay-court final for the first time in five years, having lost to Nicolas Almagro in Mexico in 2008.
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- Simone Bolelli