USA, who were down to 10 men in the second half, controlled the proceeding especially in the first half with quick short passes and led 2-0 at half time.
Malaysia though could not get a clear look at the rival goal in the first half, managed to reduce the margin in the 85th minute through Zainul Arifin Bin Ahmad Latifi.
With this win, USA have entered the final as the top team with eight points from four matches. The other finalist will be decided after the match between Korea Republic and hosts India.
USA were reduced to 10 men in the 56th minute when Kevin Roberto Negrete got a marching order from referee Tejas Nagvenkar after he needlessly stamped Muhammad Baharuddin, who was lying down on the ground when the ball was not in play.
Malaysia went all out towards the closing stages of the match and scored a goal in the 85th minute when Ahmad Latifi made room for himself on top of the box and beat rival keeper to find the roof of the net.