Despite Australia competing in the second semi-final, Muralitharan insists that Pakistan will be the main threat to Sri Lanka's bid for glory.
The spinner, who played in the 2009 final for Sri Lanka, told the Evening Standard: "If Sri Lanka beat Pakistan in tomorrow's semi-final in Colombo, they have a 90% chance of winning the World Twenty20 title.
"The home team have impressed me more than any other in the tournament and they should believe they can go on to take the trophy.
"I see Australia as the favourites against West Indies in the other semi but if Sri Lanka beat Pakistan, they can feel confident of clearing that last hurdle."
The hosts confirmed their spot in the semi-finals with a comfortable victory over England on Monday.