Raul Gonzalez scored in the 15th minute to lift Schalke to a 1-0 victory over title holder Bayern Munich in the semifinals of the German Cup on Wednesday.
Raul's goal put Schalke in the May 21 final in Berlin against second-division Duisburg.
Bayern lost a German Cup game at home for the first time in 20 years and suffered a second straight setback at home after losing 3-1 to Bundesliga leader Borussia Dortmund, a result that all but left Bayern without hope of defending the championship title.
"A betting man would have made a lot of money by betting on Schalke tonight," Schalke coach Felix Magath said. "We could have scored another goal in the first half, but in the second half we only defended. I was hoping that Bayern wasn't that fresh after two tough games."
Bayern is on the verge of reaching the quarterfinals of the Champions League after beating Inter Milan 1-0 in Italy. Inter beat Bayern in last season's final.
"It's a great disappointment for my players," Bayern coach Louis van Gaal said. "That's football, one team only defends and counterattacks and scores. We played with a lion's heart in the second half but we were unlucky.
"And we should have been awarded a penalty," van Gaal added, referring to an incident late in the game when Atsuto Uchida appeared to bring down Bayern striker Mario Gomez
Raul's goal was a powerful header into the roof of the net. Jefferson Farfan's corner was headed to the far post by defender Benedikt Hoewedes and Raul connected with a powerful header for the lead.
Raul had another opportunity in the 19th but drove wide.
The Spaniard then set up Farfan's solo run but the Peru striker's attempt was smothered by Bayern goalkeeper Thomas Kraft.
Hoewedes had another header in the 35th, but Thomas Mueller cleared on the line.
Bayern's first big opportunity came two minutes into the second half but Arjen Robben failed to connect with a cross from Danijel Pranjic.
Bayern stepped up the pace and Bastian Schweinsteiger had his header stopped by Manuel Neuer, the Schalke and Germany goalkeeper, before Robben shot wide.
Neuer, who got a hostile reception from Bayern fans although the club has expressed interest in signing him, caught a good effort by substitute Toni Kroos.
Franck Ribery was the next to threaten but Neuer again stood his ground.
Ribery should have equalized in the 87th, but Neuer was again able to stop the Frenchman's shot from 11 meters (yards) out.
