Fresh from its first ever knockout win in this competition earlier this week against Norway, England, which has been beaten three times at the quarter-final stage, stunned John Herdman's side with two goals in three minutes.
Christine Sinclair pulled one back on the stroke of half-time after a rare mistake from goalkeeper Karen Bardsley but England defended resolutely to restrict Canada's chances in the second half.
The win, its fourth successive 2-1 victory, sets up a last-four meeting with defending champion Japan, which defeated Australia 1-0 earlier in the day, in Edmonton.
It was a memorable performance from England, which had to weather a frenetic start from its opponent at a packed-out stadium.
Buoyed by a boisterous atmosphere inside the BC Place, the host came storming out of the traps, with Melissa Tancredi having the first sight at goal when she wastefully fired over after cutting inside after a wonderful counter-attack.
It proved to be a costly miss as England took an 11th-minute lead very much against the run of play.
Last defender Lauren Sesselmann's slipped at the crucial moment, allowing Taylor through and the England forward took the ball to the edge of the area before firing across Canada goalkeeper Erin McLeod with aplomb.
It doubled the lead three minutes later, silencing the stunned crowd in the process, when Bronze, England's matchwinner against Norway, headed in off the bar from Fara Williams's free-kick to the back post, prompting a team huddle from a shell-shocked Canada.
Tancredi headed over from Sophie Schmidt's free-kick as Canada threatened to get back into the contest but it continued to be troubled by set-pieces as Katie Chapman's looping header struck the bar.
Mark Sampson's team appeared resolute in defence although it gifted its opponent a way back into the game three minutes before half-time when goalkeeper Bardsley spilled Ashley Lawrence's cross to the feet of Sinclair, who gleefully fired into an empty net.
Karen Carney, who scored in group games against Mexico and Colombia, saw a dipping strike from 25 yards go over after half-time before an eye injury to Bardsley forced England into a 52nd-minute substitution, Siobhan Chamberlain making her first appearance of the tournament.
It did not seem to faze England initially and it came close to restoring its two-goal advantage as Taylor's curling strike from the left side of the penalty area produced a fine one-handed save from McLeod.
At the other end, Steph Houghton's hesitation on the edge of the area allowed Tancredi to steal in but England quickly got back in numbers to snuff out the danger.
Houghton's placed free-kick on the edge of the area went straight into the hands of McLeod, but England was finding itself being increasingly penned back into its own half as the match entered its closing stages.
Schmidt volleyed over from a decent position but that was the closest it came to finding a leveller as England held on to secure a famous win and a measure of revenge over Canada, which it lost to in the quarter-finals at the London Olympics three years ago.
