Japan took the lead in Edmonton with a first-half Aya Miyama penalty but England got back on level terms before the break when Fara Williams netted her second spot-kick of the tournament. But with extra-time seemingly inevitable, Bassett scored an unfortunate own goal, handing Japan victory and setting up a rematch of the 2011 final with USA in Vancouver on Sunday.
England almost got off to a dream start when Jodie Taylor latched on to Karen Bardsley’s clearance before smashing a volleyed effort on the bounce that drifted inches wide.
Katie Chapman settled into the contest straight away, breaking up play in midfield and restricting Japan’s ability to dictate play. She also provided an aerial threat for England early on but was unable to direct any of her headers on target.
Japan were struggling to create chances but were awarded a rather fortuitous penalty when Claire Rafferty tugged at Saori Ariyoshi’s shirt after a clearance from Japan goalkeeper Ayumi Kaihori. The initial infringement looked outside the box but skipper Miyama made no mistake from the spot, nestling the ball into the bottom corner after a stuttered run-up to give Japan a 32nd-minute lead.
But England refused to lie down and were awarded a penalty of their own eight minutes later when Steph Houghton had her ankle trod on by Yuki Ogimi following a corner swung in by Williams.
Williams showed iron nerve to fire the ball into the bottom left corner and send England into the half-time break on level terms.
England made a brisk start to the second half and almost went ahead on the hour mark when Duggan unleashed a shot from the left corner of the area that rattled off the crossbar.
A minute later, substitute Ellen White had a curled effort from outside the area, forcing a fingertip save from Kaihori. A succession of corners followed and Jill Scott had a glorious opportunity to put England 2-1 up but saw her header drift inches wide.
Japan substitute Mana Iwabuchi took on a couple of England defenders and fired wide at the other end of the pitch before Rafferty saw her mis-hit cross flick the top of the Japan crossbar.
In the second minute of added time, Japan broke down the right flank through Nahomi Kawasumi.
The winger played a delicate ball into the area for Ogimi, forcing Bassett to come across to try and clear. But the ball flicked the outside of Bassett’s boot and looped over Bardsley, crossing the line via the underside of the crossbar.
There was barely time for the match to restart as England’s women suffered a semi-final defeat in the most agonising of circumstances.
They will now play European champions Germany at the same Commonwealth Stadium venue on Saturday to determine which side will finish the Women’s World Cup in third place.