David Luiz formally opened the scoring for Brazil after Thiago Silva's flick-on from a Neymar corner, in spite of the fact that replays appeared to recommend the ball had fallen off Chile's Gonzalo Jara.
In any case the host country were pegged back simply after the half-hour mark when Alexis Sanchez adjusted after messy Selecao guarding from a toss in profound in their own particular half.
Brazil fans were then brought to their feet 10 minutes into the second half just to have their trusts of a second objective dashed after Hulk's strike was denied for a handball in the assemble up.
Both South American sides attempted to design a finer goalscoring risk as vitality levels dropped and the diversion went into additional time, when Mauricio Pinilla had the best opportunity to win the match for Chile by smashing a 20-yard strike against the crossbar in the 120th moment.
Along these lines the last-16 attach must be chosen with spot kicks and it was Brazil goalkeeper Julio Cesar who emerged as the legend, pulling off two recoveries to see Luiz Felipe Scolari's men into the quarter-finals.
Three hours prior, musings that a very charged environment would stew after the spine-shivering national hymns were immediately scattered, as Fernandinho - beginning in midfield set up of the highly defamed Paulinho - crunched into an early test.
Maybe inferring that there was at that point enough yellow on show in the stadium, official Howard Webb rightly kept his cards in his pocket.
Brazil began splendidly, beating Chile at their diversion as they pressed high and managed their South American partners little space.
Furthermore following 18 minutes their try brought the corner that made the opening objective, Thiago Silva flicking on Neymar's conveyance to the back post - where Gonzalo Jara tussled with David Luiz. The Paris Saint-Germain-bound protector was formally credited with the objective, in spite of the fact that replays proposed that Jara had got a definitive touch to redirect the ball goalward.
A long way from accepting control, however, Brazil were made to pay for a few messiness at the back 14 minutes after the fact, Eduardo Vargas capturing a stray Hulk pass and sliding in Sanchez, who created the coolest of side-footed completions.
Abruptly end-to-end in nature, the amusement very nearly had a third objective before the break as Neymar, Fred and Dani Alves all went close.
Chile gave an alternate indication of their danger simply preceding the interim, Alexis denied his second just by Luiz's last-dump sliding test.
An alternate flashpoint came rapidly after the restart, Brazil kept from leads the pack when Hulk was urgently decreed to have taken care of Marcelo's ball absurd, which had gone before a fine left-footed completion.
The choice was met by a discord of sneers from the home fans, however easing was to uproot any sentiments of foul play Brazil may have had a couple of minutes after the fact, Julio Cesar delivering a dazzling reactionary recovery to keep out Charles Aranguiz's exertion after fine work from Arturo Vidal and Mauricio Isla.
Brazil kept on lookking unsafe at the flip side, in spite of the fact that Neymar's standard self-control left him as he headed Alves' cross straight at goalkeeper Claudio Bravo - who was later available to keep out an influential Hulk strike.
Additional time brought with it an included caginess - but except for Hulk, who - obviously prodded on by a feeling of foul play - was at the heart of everything, encapsulated by a compelling exertion that constrained Bravo into a stop.
With Chile all of a sudden stayed outdoors on their own case, further risks did not emerge however Jorge Sampaoli's underdogs just about grabbed it comfortable end of the included period - substitute Pinilla rattling the woodwork with a loud drive in the last moment as the hosts were managed an immense cut of favorable luck.
Furthermore it was one they exploited. Brazil promptly took control of the shoot-out as David Luiz sent Bravo the wrong way and Pinilla saw his exertion spared by Julio Cesar.
Furthermore, regardless of misses from Willian and Hulk, Jara shook the post with the last kick to leave Neymar's cooly required exertion as the winning one.
Brazil 1-1 Chile (pens 3-2): Super Cesar spares Selecao from ahead of schedule passageway