Canadian International Paul Peschisolido scored two late winning goals which sent them into the next round. The substitute striker struck the deadly blows in the space of two minutes which gave Crystal Palace little chance of a fight back.
Palace were missing 11 players through injury and suspension but looked to have forced the game into extra time with a equaliser nine minutes from time. It was Blades captain Robert Page who was judged to have scored the Eagles goal when in fact it cannoned off Murphy has Page tried to clear a cross which had the misfortune of finding the net.
However it was Peschisolido who grabbed the limelight as his controversial goal within minutes of replacing Asaba before netting soon after leaving the Nationwide Club with a dream of getting to the final in Cardiff.
The Palace leveler came when Tommy Black's cross was met by the foot of Robert Page but his clearance struck Shaun Murphy where it somehow crept passed Paddy Kenny and into the corner of the goal.
Peschisolido was told by the Club doctor that he really should not
play but only for 10 minutes if needed. He made a immediate impact in the game as he headed the ball over Latvian International Alexandrs Kolinko after Ndlovu crossed. However Kolinko claimed that Peschisolido was in a offside position, but referee Eddie Wolstenholm ignored Kolinko's plea and brandished a yellow card for his actions.
Two minutes later Paul Peschisolido got on the header from Wayne Allison where Peschisolido poked the ball into the left hand corner of the goal leaving Kolinko unable to stop the ball.
Within 18 minutes of the kickoff United could have made it 1-0 when Michael Brown's pass broke open the Palace defence leaving Peter Ndlovu free on the right-wing, his superb cross found the head of Allison but his direct header went just wide of the goalpost.
Palace were without a few first team players but United were not going to let that worry them as United attacked and attacked they almost broke the deadlock when Michael Tonge's cornered cross was pushed over the bar after Murphy headed towards goal.
From the resulting corner Tonge drilled the ball onto the far post when Jagielka's header set up Carl Asaba who neatly put the ball home after beating off his marker. It was King Carl's ninth goal of the 2002-03 season campaign and the 22,211 crowed could sense that the semi-final could be United's.
Andy Johnson, who appeared in the Liverpool v Birmingham City League Cup Final a few years ago for the Blues had a penalty claim turned down moments later as he was challenged by Stuart McCall in the penalty area but the referee gave nothing.
Eight minutes into the second half and Palace almost equalised when central defender Kit Symons was left unmarked on a corner but his header rebounded off Page and was cleared with ease. Andy Johnson was a huge threat to United as he continuously tested Paddy Kenny on three occasions but failed to beat the ever improving keeper.
United looked nervous and showed it as Palace put Blades backs against the wall, however Asaba had a great opportunity to make it 2-0 when Palace were court in possession as Tonge tackled which found Asaba and his 18 yard desperate shot sailed over the cross bar.
On 76th minute England U-20 International Michael Tonge came ever so close to sealing the win as he dribbled the ball around the defenders in the penalty area and his square ball hit Danny Butterfields back and went out for a corner when it could have easily gone in the net.
Paddy Kenny produced another fine save, this time from Hayden Mullins before they equalised from the resulting corner which Kenny could do nothing about.
Full-Time: Sheffield United 3-1 Crystal Palace
Man of the Match: I thought that on the whole the entire team played well when we were not defending but Michael Tonge stood out for me as Blades best player on the pitch so he will get this man of the match award.