FIFA World Cup: Brazil 1 Chile 1 (after extra time, 3-2 on penalties)

Neymar converted the decisive kick as hosts Brazil edged a pulsating FIFA World Cup last-16 meeting with Chile 3-2 on penalties.

Roared on by a partisan home crowd as spot-kicks were required to settle Saturday's electric battle of the two South American nations following a 1-1 draw, the men in yellow kept their cool.

Having dusted themselves off having been just a few centimetres from elimination when Mauricio Pinilla rattled the crossbar in the final minute of extra-time at the Estadio Mineirao in Belo Horizonte, Brazil progressed to the quarter-finals as Julio Cesar saved two penalties before Gonzalo Jara crucially hit the post to send Brazil through.

Earlier, Alexis Sanchez had cancelled out Brazil's 18th-minute opener, which was officially credited to David Luiz but appeared to come off Jara on its way into the net.

Such debate hardly seemed important though, especially when the hosts - much to the dismay of their adoring public - were denied a second goal when handball was given against Hulk as he controlled to set up a fine volley.

But the scrutiny over that decision was reduced significantly as Brazil ultimately prevailed to set-up an all-CONMEBOL last-eight meeting with the winners of Saturday's second clash between Colombia and Uruguay.

Any thoughts that a highly-charged atmosphere would simmer after the spine-tingling national anthems were quickly dispelled, as Fernandinho - starting in midfield in place of the much-maligned Paulinho - crunched into an early challenge. 

Perhaps concluding that there was already enough yellow on show in the stadium, referee Howard Webb rightly kept his cards in his pocket.

Brazil started brightly, beating Chile at their own game as they pressed high and afforded their South American counterparts little space.

And after 18 minutes their endeavour brought the corner that created the opening goal, Thiago Silva flicking on Neymar's delivery to the back post - where Jara tussled with Luiz. The Paris Saint-Germain-bound defender was officially credited with the goal, although replays suggested that Jara had got a decisive touch to divert the ball goalward.

Far from assuming control, though, Brazil were made to pay for some sloppiness at the back 14 minutes later, Eduardo Vargas intercepting a stray Hulk pass and sliding in Sanchez, who produced the coolest of side-footed finishes.

Suddenly end-to-end in nature, the game almost had a third goal before the break as Neymar, Fred and Dani Alves all went close.

Chile gave another reminder of their threat just prior to the interval, Sanchez denied his second only by Luiz's last-ditch sliding challenge.

Another flashpoint came quickly after the restart, Brazil prevented from taking the lead when Hulk was crucially adjudged to have handled Marcelo's ball over the top, which had preceded a fine left-footed finish.

The decision was met by a cacophony of jeers from the home fans, but relief was to displace any feelings of injustice Brazil might have had a few moments later, Julio Cesar producing a stunning reactionary save to keep out Charles Aranguiz's effort following fine work from Arturo Vidal and Mauricio Isla.

Brazil continued to look dangerous at the other end, although Neymar's customary composure deserted him as he headed Alves' cross straight at goalkeeper Claudio Bravo - who was later on hand to keep out a powerful Hulk strike.

Extra time brought with it an added caginess - albeit with the exception of Hulk, who - apparently spurred on by a sense of injustice - was at the heart of everything, epitomised by a powerful effort that forced Bravo into a stop.

With Chile suddenly camped on their own box, further chances did not materialise but Jorge Sampaoli's underdogs almost snatched it right at the end of the added period - substitute Pinilla rattling the woodwork with a thunderous drive in the final minute as the hosts were afforded a huge slice of good fortune.

And it was one they took full advantage of.

Brazil immediately took control of the shoot-out as Luiz sent Bravo the wrong way and Pinilla saw his effort saved by Julio Cesar.

And despite misses from  Willian and Hulk, Jara rattled the post with the final kick to leave Neymar's effort as the winning one.