The 2022 semi-finalists Morocco will face title favourites France or Paraguay as the business end of the tournament in North America approaches.
After a first half littered with more bookings than shots, midfielder Azzedine Ounahi fired the opener on 50 minutes.
Canada, playing the biggest game in their footballing history, pushed for an equaliser, but Ounahi scored his second to finally see off the resistance of Jesse Marsch’s men.
Substitute Soufiane Rahimi slipped in the third with the last kick of the match.
It was tough on Canada, who were the better side in the opening period in front of a crowd of 68,777 as they sought to make more history.
They came into the contest in uncharted territory, having won a World Cup match and then a knockout game for the first time to get to the last 16.
They were clear underdogs and their fans were outnumbered by Morocco supporters at the air-conditioned Houston Stadium.
Morocco, who beat Canada in the group phase at the 2022 World Cup, came out for the second period transformed.
Five minutes after the restart Hakimi pinged a low free-kick to Ounahi unmarked outside the box and he swept in first time.
Canada goalkeeper Maxime Crepeau had his view blocked by two of his defenders and the ball also went through Rahimi’s legs.
On 82 minutes, Ounahi was the man in the right place again on the breakaway with another right-footed first-time finish, before Rahimi pounced in the 98th minute. (AFP)
