Mohammed al Shehhi scored the winning penalty as the UAE advanced to the semi-finals where they will face South Korea, who beat Uzbekistan 3-1 in extra time.
UAE beat North Korea on penalties at Asian Games
GUANGZHOU // Ali Khasif, the Jazira goalkeeper, made the decisive save and then Mohammed al Shehhi stepped up to secure the UAE's 9-8 win on penalties in their quarter-final match against North Korea at the Asian Games.
The narrow victory earned the UAE a semi-final spot against South Korea, who beat Uzbekistan 3-1 in extra time.
In the other quarter-finals, Iran edged Oman 1-0 to move into a semi-final against Japan, a 1-0 winner over Bryan Robson's Thailand squad.
The UAE-North Korea match was locked at 0-0 after extra time, forcing a shoot-out which progressed to 8-8 before goalkeeper Housani saved Ri Chol Myong's attempt.
Alshehhi beat the Korean keeper with the next effort, sparking celebrations for the UAE team and disappointment for a North Korean line-up featuring seven survivors from the World Cup squad.
"I felt great pressure and was very nervous because everybody was watching me," Alshehhi said. "Our target is to win the next match and to reach the final."
North Korea had been considered a gold-medal favourite, their status enhanced after an opening 1-0 win over South Korea, and didn't concede a goal in regulation time during the tournament.
The UAE coach Mahdi Ali said his squad had nullified North Korea's game plan by taking aerial control.
"I'm proud of this team. This is a young team ... DPR Korea players are older and many of them are from their senior national team. I congratulate all our players and staff."
Iran scored in the 41st minute against Oman when their midfielder Aliasaridehaghi glanced a curling free kick in off the near post.
Keigo Higashi's strike a minute before half time was just enough for Japan to beat Thailand, which rued an open goal miss from Suttinun Phukhom.
The Japanese team have not conceded a goal in five matches.
"It's very unfortunate. We were the better team over the 90 minutes," the former England captain Robson said of his Thailand team. "We got into good positions, especially in the first half, but couldn't convert any of our chances.
"I'm glad we won two matches here, and I don't think it is a failure to lose in the quarter-finals."