The top seed Russian lost the first set, but came back impressively in the semifinals to defeat Pablo Carreno Busta.
On the back of his thumping victory at Belgrade Open, the Serbian has the fifth most Open Era wins list.
The three highest-seeded players were all eliminated from the Emilia-Romagna Open on Wednesday (May 26).
On the back of the comeback win, Thiem will now take on local favourite Lorenzo Sonego in the next round.
Carreno Busta survives a three-set battle to win in Marbella; Sonego bags the singles and doubles titles in Cagliari
The World No 15 Pablo Carreno Busta overcomes compatriot Albert Ramos Vinolas in a three-set thriller to enter the final