The five-time world champions, who are aiming to claim their second successive Confederations Cup title, have reached the final four after recording three victories in the group stage over Egypt, USA and Italy.
After Spain surprisingly crashed out at the hands of the US, Brazil have become favorites to win the global title with ease.
Brazil head coach Dunga believes the Bafana Bafana, who will be trying to use the home advantage to spring a surprise like USA, are going to be tough to beat.
"South Africa are improving game by game, but we are ready and waiting for the challenge," Dunga told a pre-match news conference on Wednesday.
"We want to improve in every game and because South Africa are in the semis they have to be respected.
"It won't be easy for us -- they are playing at home and they have the greater emotional support.
"But playing the host is going to be good preparation for the World Cup. Every game is different in a tournament, the players need to experience everything."
Previous Rapport
Dunga worked under the management of South Africa boss Joel Santana at Vasco da Gama in the 1980s, and they also worked together with Brazil's Olympic side.
Now both Brazilians will come face to face at Ellis Park.
"As far as me and Joel are concerned, we were together at Vasco, he is a very calm person, knows what he is doing," Dunga stated.
"Every trainer tries to look for the positives in his players, the same applies to him.
"We did not get the best results when we worked together at the Olympic Games but we just had six days to prepare, so taking this into account we did alright."
In their previous two meetings, Brazil defeated South Africa 3-2 and 2-1 in 1996 and 1997 respectively; Dunga was the Samba Dancers' skipper in the latter game.
Missing players
Brazil will have to do without Juan, who will play no further part in the Confederations Cup due to injury.
The AS Roma man will be sidelined for a week after sustaining a minor muscle injury in his left leg.
Luisao is most likely to deputize in the absence of Juan.
On the other hand, South Africa midfielder Macbeth Sibaya has been ruled out of the semi-final showdown through suspension.
Moreover, Santana's team were dealt a major blow by the news that in-form striker Bernard Parker had picked up a knee problem, and now is doubtful for the game.
Parker got injured during training on Wednesday, and thus pulled out of the session.
Santana is yet to decide whether to field him against Brazil or not.
"He had a slight problem and we were advised by the team doctor that he shouldn't go on with the training session," the experienced tactician said.
"It would be better for the player to rest today and we'll do some tests today.
"He is a new talent and we would like to have him in our team tomorrow (Thursday)."