Makhloufi, who won silver in the 800m behind David Rudisha Monday, came in second behind Kiprop in their semi-final.
Olympics: Kiprop sets up 1500m battle with Makhloufi
Kenyan Asbel Kiprop set up a battle royale with Algeria's defending champion Taoufik Makhloufi in Saturday's Olympic 1500m final after both advanced smoothly from the semi-finals.
Kiprop, the 2008 Olympic gold medallist and three-time defending world champion, easily won the heat in 3:39.73 after a stunning wide run-in from 250 metres.
Also qualifying for Saturday's final will be Morocco's Abalaati Iguider, the American trio of Matthew Centrowitz, Robby Andrews and Ben Blankenship, Kiprop's teammate Ronald Kwemoi, Djibouti's Ayanleh Souleiman, Kiwi Nicholas Willis, Australian Ryan Gregson, Canadian Nathan Brannen and Briton Charlie Grice.
