After a goalless 90 minutes against the tournament's hosts, the game headed straight to penalties, with Brazil prevailing with a 4-3 shootout victory.
Paraguay were also reduced to ten men during the last-eight clash as West Ham defender, Fabian Balbuena, received a red card towards the hour mark.
Despite beating Brazil the last two times the sides had met in the quarter-final stages, winning both times on penalties in 2011 and 2015, Paraguay could not repeat their past heroics.
Almirón calmly converted La Albirroja's second penalty kick, sending Liverpool goalkeeper Allison the wrong way, who had saved the opening penalty from defender Gustavo Gomez.
Despite Liverpool forward Roberto Firmino firing wide for Brazil, Manchester City striker Gabriel Jesus scored the decisive penalty for Seleção after Derlis Gonzalez sent his penalty wide of the target.
Almirón has been an ever-present during the South American competition, starting in all four of Paraguay's matches, recording two assists in the process.