Paraguay beat Japan on penalties after a goalless 120 minutes in the second round after finishing top of Group F by beating Slovakia and drawing with Italy and New Zealand.
"Probably if you did an analysis at this moment in time, there are many teams who are superior to Paraguay in football terms but I don't know if they all have the heart that we have and I don't know if they all recognise the historic moment which is before them in the way that we do," Martino told reporters.
"We have lots of heart and are faced with what is probably a unique opportunity for us, in this respect we are unmatched," he said.
Paraguay have never reached the World Cup semi-finals and victory over the Spaniards would set up a last-four meeting with Argentina or Germany.
Martino said his team were playing the right way for a knockout Cup competition.
"If we had to play in a tournament of 20 fixtures we probably wouldn't succeed. But as we will be playing 90 or 120 minutes, with our heart and knowing that we are before the opportunity of our lifetime, we can succeed in our goal," he said.
Striker Roque Santa Cruz said Paraguay loved playing against top teams and that they would be fired up for the Spain clash.
"They have been among the favourites right from the outset and so that will give us a bit of extra motivation," he said. "We know their players very well so it is a case of focusing on what we face in team terms."
