Shea Salinas missed the decisive penalty for San Jose Earthquakes on Wednesday with his spot-kick coming back off the crossbar.
The 27-year-old midfielder's miss saw Toluca prevail 5-4 in the shootout, after the two-legged tie had finished 2-2 on aggregate.
Toluca dominated the second leg at home and took 23 shots to the Earthquakes' five but the visitors were the first to score when defender Ty Harden nodded Salinas' free-kick into the net in the 56th minute.
Isaac Brizuela's thumping long-range strike dragged Toluca level with 21 minutes left in normal time but although the hosts continued to pressure, San Jose held out with goalkeeper Jon Busch making some impressive saves.
After a goalless extra-time period, Busch gave the Earthquakes the upper hand when he saved Toluca's first penalty from Raul Nava but the home side's gloveman Alfredo Talavera responded immediately with a stop of this own, thwarting Chris Wondolowski.
Each side converted their next four spot-kicks with Talavera stepping up to slot Toluca's fifth past Busch.
As the shootout headed to sudden death, Busch almost saved Wilson Tiago's penalty but could only parry the ball onto the underside of the bar and it bounced back onto the line before spinning into the net.
The home fans breathed a sigh of relief and then screamed for joy as Salinas missed to end the Earthquakes' hopes.
In the other quarter-final second leg on Wednesday, Cruz Azul overturned a 1-0 first leg deficit to triumph 5-2 on aggregate against Sporting Kansas City.
Mariano Pavone scored a hat-trick for the Liga MX outfit, while Mauro Formica and Christian Gimenez also got on the scoresheet as Cruz Azul thrashed Sporting in Mexico.
Pavone struck in the second minute and scored again in the 23rd minute before Benny Feilhaber pulled a goal back just ahead of the break.
At 2-2 on aggregate, Sporting would have become the only MLS club to stay in the competition on the away-goals rule, after San Jose and Los Angeles Galaxy were also eliminated by Mexican sides.
But 10 minutes after half-time, Pavone toe-poked Sergio Napoles' cross into the net to complete his hat-trick and put the hosts in front, before Formica and Gimenez struck to end Kansas City's resistance.
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