The 19-year-old Briton was trailing 4-6 6-3 3-0 to Latvian Jelena Ostapenko in Seoul but was unable to complete the match.
Raducanu had come from a break down to win the first set but former French Open champion Ostapenko levelled in the second and had edged ahead.
Raducanu, the US Open winner last year, had been bidding to reach her first final in a regular WTA Tour event after winning her three previous matches.
She fell behind early in the first set but broke back immediately and claimed a decisive break at 4-4.
Raducanu carried the momentum into the second set and broke again but this time Ostapenko hit back quickly.
Raducanu needed a medical time-out and could not halt Ostapenko's charge when she returned to the court.
Ostapenko broke again and went on to take the second set before taking control of the third.
Ostapenko will go through to play Ekaterina Alexandrova in the final after the second seed's 6-2 6-4 victory over Tatjana Maria.