The Reds put in an outstanding, controlled performance in the BayArena to secure a 3-1 second-leg victory over Bayer Leverkusen and a massive 6-2 aggregate triumph.
Luis Garcia grabbed a first-half double and Milan Baros was rewarded for a hard-working display as a lone striker with the third as Jacek Krzynowek pulled one back late on for the hosts.
It was sweet revenge for the Reds, who lost a dramatic quarter-final here three years ago, and now they are back at that same stage again,
Benitez tried hard to calm the euphoria that swept around the ground by insisting: "We are not thinking about winning the Champions League, only waiting for the draw to see who we have next. But just maybe we can go all the way, but we don't want to start talking about winning the trophy.
"I feel we have played better matches, against Olympiacos and Monaco for example, but certainly in the first half we produced a very good display."
But Benitez, in a quarter-final in his first season at Anfield, revealed his own enjoyment of the result.
He said: "I am enjoying my time here, I have the respect of the fans and the board. As a manager I am very, very happy at the club and am certainly enjoying winning matches at this level.
"We started the game very, very well at a high tempo and once we had scored those two early goals it made everything much easier after that."
Bayer Leverkusen coach Klaus Augenthaler accepted defeat with good grace, saying: "I congratulate Liverpool for making it to the last eight, and after the two games they deserved to go through."
Steven Gerrard, who says he wants this level of football all the time, was the outstanding player on the pitch, running Leverkusen ragged.
But it was Luis Garcia who grabbed two priceless first half goals which ended the contest.
Baros could have got Liverpool off to a great start after just four minutes but he shot weakly at Jorg Butt.
Baros' pace constantly unsettled the Germans and he almost set up Gerrard up for a clear chance before presenting his skipper with another opening a 25-yard effort which Butt touched wide.
The corner was wasted, but Leverkusen did not clear it properly and the ball arrived back at Gerrard's feet.
He instantly fed the ball into the box and Luis Garcia was on hand to clip the ball past Butt with the outside of his foot to give Liverpool the away goal they so desperately wanted.
Bayer then had to send on Andrej Voronin for the limping Dimitar Berbatov, but seconds later they found themselves 2-0 down on the night.
Gerrard was again the supplier, sending in a corner which Igor Biscan headed down and Luis Garcia swept past Butt from close range. Garcia almost got his hat-trick when he was set-up by Baros but his 12-yard drive was tipped over by Butt.
Gerrard started the second half in increasingly dominant form. Bayer failed to get to grips with his roving role and he kept popping up in critical positions to break up play and feed Baros, Riise and Luis Garcia.
The England midfielder was everywhere, prompting, surging forward and finding space to drag the Germans out of position with clever, telling passes.
Leverkusen sent on Clemens Fritz for ineffective USA international Landon Donovan eight minutes after the restart.
Two minutes later the hosts wasted their best chance when Daniel Bierofka crossed from the right and the unmarked Franca hooked the ball up and over the bar.
Gerrard saw a blistering drive blocked by Butt on 63 minutes and was alert enough to regain control and set up Baros for a close range chance which the striker sliced badly across goal.
But in the 66th minute Baros finally found the net and finished the contest beyond question.
Warnock and Riise created the chance, and Baros jinked inside a defender to drill home the third goal.
Jacek Krzynowek scored a late consolation goal but Liverpool's fans were by now reminding the world how they were going to win the cup for the fifth time.
BAYER LEVERKUSEN: Butt; Schneider, Callsen-Bracker, Ramelow (Castro 70), Placente, Babic, Bierofka, Krzynowek, Donovan (Fritz 53), Franca, Berbatov (Voronin 32).
LIVERPOOL: Dudek, Finnan (Nunez 74), Hyypia, Carragher (Welsh 70), Warnock, Luis Garcia, Hamann (Smicer 62), Biscan, Riise, Gerrard, Baros.
Referee: Alain Sars (France).