The winner came via an unfortunate early own goal from Stars defender Sphamandla Mlilo, but the lower-league side had several chances to level the game.
It was not to be, though, and their excellent run, which had seen them oust Orlando Pirates and AmaZulu on their way to the semi-finals, came to an end.
City were in front inside six minutes and it was a calamitous own goal for the visitors. Terrence Mashego put in a cross from the right and, as Mlilo tried to clear, he could only force the ball into the back of his own net.
Mlilo became just the third player to score an own goal in the Nedbank Cup semi-finals since 2008, after Mario Booysen (Maritzburg United) and Lucky Mohomi (Free State Stars).
Mlilo had a chance at the other end almost immediately, but could not steer his header from a free-kick on goal, while Stars goalkeeper Tshigwana Mthombeni, son of owner-coach Joseph ‘Bucs’ Mthombeni, had to be smart to deny Saziso Magawana at the back post as it was almost 2-0.
City should have added a second when Jean Lwamba was supplied from the right and had only to steer the ball into the Stars net, but ballooned his shot high and wide.
Stars had an excellent chance to equalise just before the hour mark when Decide Chauke was through on goal, but the ball was taken off him just as he was about to shoot with only goalkeeper Darren Keet to beat.
Keet then had to make a smart save to deny Siphosethu Meveni from close range, before it was almost another own goal by Stars when Lifa Makua tried to clear a cross and the ball went behind off the crossbar.
City reached the final for the second time, though the first in their current guise.
They were formed when Maritzburg United relocated to Durban and changed their name, but they have the same owners.
They were in the Nedbank Cup final in 2018, but lost 1-0 to Free State Stars in Cape Town. The irony? Casric Stars were formed when Mthombeni purchased the status of Free State Stars in 2022, so Saturday’s result was a revenge mission of sorts.
It was a third clean sheet in four games in the Nedbank Cup for City this season, and the first time they have advanced without needing penalties.
In fact, their previous five Nedbank Cup ties had all gone to extra time, and the last four to penalties.
The second semi-final on Sunday will see TS Galaxy host another second-tier side, Milford FC, at Solomon Mahlangu Stadium (kick-off 15h00).
Galaxy were champions in 2019 when, as a second-tier side themselves, they defeated Kaizer Chiefs 1-0 in the decider in Durban.
Four teams from outside the Betway Premiership have reached the Nedbank Cup final before, but aside from Galaxy, all lost.
Mpumalanga Black Aces were beaten 1-0 by Mamelodi Sundowns in 2008, University of Pretoria lost by the same scoreline to Moroka Swallows the following year, and Black Leopards were beaten 3-1 by Orlando Pirates in 2011.
The 2026 Nedbank Cup final is scheduled to be played on May 2.