Iceland shocked all when they equalised five minutes later through Alfred Finnbogason on 24 minutes.
A last minute penalty from Cristiano Ronaldo gave Real Madrid the goal they needed to beat Juventus 3-1 on Wednesday night, after the Bianconeri had leveled the aggregate score.
Mario Mandzukic became the first player to score two first-half away goals at the Estadio Bernabeu in a Champions League match, after he opened the scoring early on then grabbed another just before the break. Blaise Matuidi completed the comeback on the hour as he capitalised on a Keylor Navas error.
But just as it looked like the tie was heading to extra-time, Mehdi Benatia gave away a penalty in the 93rd minute, which Ronaldo blasted into the top corner. Juventus goalkeeper Gianluigi Buffon was sent off for his protestations.
After Tuesday’s heroics by Roma, Juventus went about part two of mission impossible in right way, scoring just two minutes in.
Sami Khedira got free on the right to pass the ball to the back post with Mandzukic free to head past a stranded Keyor Navas.
A frantic start to the game saw Madrid go up the other end with Juve relying on a Gianluigi Buffon double save to deny Gareth Bale, who tried a delicious back heel on his second attempt.
Ronaldo was next up to have a go and his powerful effort was well saved by an alert Buffon.
It looked as if Madrid were on their way to a killer goal, as first Marcelo then Isco both had attempts, as did Toni Kroos, though a combination of poor finishing and a Juve defence throwing everything in the way denied Los Blancos.
Zidane’s men were given a warning of things to come as Mandzukic got on the end of a low Miralem Pjanic cross from the right, and it bounced off his knee from three yards out and into the hands of Navas.
Then again from the right side, Stephan Lichtsteiner hung a deep looping ball to the back post once more and Mandzukic rose above Dani Carvajal to bag his second header of the night.
As half time approached, Raphael Varane smacked the crossbar with a header.
After the break, Douglas Costa signaled Juventus’ intent, cutting in from the right and blasting over.
Ronaldo had a go from the edge of the area, while Gonzalo Higuain turned from the same range with both shots saved by their respective goalkeepers.
However, just after the hour mark Douglas Costa launched a deep cross into the area and it looked like Navas would gather easily, Matuidi came rushing in and knocked the ball from the goalkeepers grasp, before side-footing home.
Buffon showed great reactions as he palmed an Isco shot which took a wicked deflection off Mehdi Benatia, then Varane flashed an effort just wide from the penalty area.
As the 90 minutes came to an end Carvajal found Ronaldo at the back post, but the Portuguese was unable get his header on target, but things were to get much more controversial.
Ronaldo headed a cross back across goal to Lucas Vazquez, who was fouled by Benatia, and the referee awarded a penalty. Buffon was then sent off or his protests.
And in the fourth minute of added time, Ronaldo stepped up to send Real Madrid into the semi-finals