Vacherot, who was ranked outside the top 200 before his shock Shanghai Masters triumph last year, downed Alex De Minaur 6-4 3-6 6-3 in front of roaring fans on Friday and became the first Monegasque player to reach the last-four at Monte Carlo.
World number two Jannik Sinner, who has the opportunity to reclaim top spot from Alcaraz, meets the third-ranked Alexander Zverev in the other semi-final.
"It's such an honour to be part of the semi-finals with the three best players of the past few years," Vacherot said shortly after his win in Monte Carlo on Friday.
"I can't wait to play Carlos in my hometown, it's amazing.
"The guys in the crowd chanting, they're my best friends from when I was nine or 10 years old. It's rare for a player to have this chance to have this many people around.
"I'm so lucky to have a tournament in my club."
Vacherot is projected to break into the top 20 when the ATP rankings are updated on Monday. Alcaraz was left impressed by the 27-year-old's rise.
"It's impressive, his story. He has a lot of motivation playing at home," Alcaraz said shortly before Vacherot set up their last-four clash, which takes place later on Saturday.
"He has won great matches this tournament this year. I've never played against him before; I just practised with him once at Indian Wells. I know he's a pretty tough opponent to play."