Marcelo, Karim Benzema and Angel Di Maria struck the goals as Madrid put to bed their miserable record of having fallen at this same last-16 stage for six successive editions – including against Lyon last season. The victory also means Madrid are a step closer to winning a record 10th European title, and keeps coach Jose Mourinho on course to conquer Europe with three different teams following his success with Porto and then Inter Milan last year.
Madrid started in frenetic fashion and Hugo Lloris did well to deny Mesut Ozil and Marcelo before Sami Khedira headed a corner against the post, although he was penalised for his challenge on the Lyon goalkeeper.
The home side were unable to continue that early dominance though, and Lyon gradually started to enjoy more possession and they gave Madrid a scare in the 21st minute when Cesar Delgado brought a diving parry out of Iker Casillas.
Madrid were back on the attack soon after that and Cristiano Ronaldo – back in the side following a two-match absence due to injury – drew a brilliant diving save out of Lloris with a thunderous strike.
However, where Madrid’s much-vaunted attackers were unable to find a way through, full-back Marcelo succeeded in the 37th minute to put Mourinho’s men ahead.
The Brazil international charged forward from his left-back berth, played a one-two with Ronaldo on the edge of the area, superbly cut inside sliding Lyon defender Dejan Lovren and thumped a shot past Lloris, who got a hand to the ball but could not keep it out.
That was the breakthrough Madrid were seeking, and in-form striker Benzema almost made it 2-0 moments later with a well-struck effort that produced another great finger-tip save from Lloris.
In Madrid’s very next attack Benzema found the back of the net with a header but the former Lyon striker, who had netted eight times in his previous six games, saw his celebrations cut short by an offside flag.
Lyon coach Claude Puel introduced Bafetimbi Gomis, the French side’s goalscorer in the 1-1 first leg draw, at half-time, but it was Madrid who continued to make most of the running in the second period.
Benzema (twice) and Sergio Ramos both went close before the former continued his fine scoring form by making it 2-0 in the 65th minute.
Marcelo’s long ball over the top was latched onto by the £30million striker and he slotted his shot through the legs of Lloris.
Benzema was then denied by the Lyon custodian as Madrid sought a third, before Casillas was finally called into action again in the 71st minute to parry a well-struck Gomis shot which almost dropped inside the far post.
A goal then would have given Lyon hope, but within four minutes they were 3-0 down and on their way out of the competition.
Ozil’s header put Di Maria through and the Argentina winger coolly dinked his shot over Lloris to seal Madrid’s 25th successive home win in all competitions and, more importantly, a berth in the last eight of the Champions League at long last.
REAL MADRID: Casillas, Sergio Ramos, Pepe, Carvalho, Marcelo, Khedira, Alonso, Di Maria (Granero 78), Ozil, Ronaldo (Adebayor 74), Benzema (Diarra 84).
LYON: Lloris, Reveillere, Cris, Lovren, Cissokho, Briand (Gomis 46), Gourcuff (Pied 69), Toulalan, Kallstrom, Delgado (Pjanic 81), Lopez.
Referee: Damir Skomina (Slovenia).