Team Melli defeated South Korea 80-68 at the Istora Gelora Bung Karno.
Hamed Haddadi led Iran with 23 points and Ricardo Preston scored 34 points for South Korea.
Iran will play the winner of Chinese Taipei and China in the final match on Sept. 1.
The 2018 Asian Games, officially known as the 18th Asian Games and also known as Jakarta Palembang 2018, is a pan-Asian multi-sport event. The event is underway from 18 August to 2 September in the Indonesian cities of Jakarta and Palembang.
The athletes compete in 465 events across 40 sports and 67 disciplines.