While fourth-ranked England were semi-finalists at the last two World Cups, and won the European Championship on home soil last year, 10th-ranked Australia have never previously been past the quarter-finals at a major global tournament.
"If you look at rankings they're favourites. If you look at where their players play, they have starting players in top clubs in top leagues all over the world," Gustavsson said on Tuesday.
"Not just the starting 11, down to 15, 16. We have bench players in those teams. We have players playing in mid-table teams in Sweden.
"So if you look at all that and you look at resources, financially, obviously they are massive favourites going into this game.
"But the one thing that we have that they don't have is the support and belief from the fans. That in itself is going to be massive tomorrow."
Another sellout crowd of around the 75,000 mark is expected at Stadium Australia for Wednesday's match and most will be backing the home team.
Gustavsson said his top striker Sam Kerr was fit to play but he was not certain that she would start as her workload was still being managed because of the calf injury that ruled her out of Australia's first three matches.
"There'll be a meeting tonight again to see the best starting 11, the best finishing 11 and whether we plan for 90 minutes or plan for an extra time," he said.
"There'll be some tough decisions again tonight but Sam is definitely available for selection."
The Matildas may have no experience of matches at the business end of a major global tournament but Gustavsson was an assistant coach for the US teams that won the last two World Cups in 2015 and 2019.
The 50-year-old said that experience had taught him to expect a tight game on Wednesday with extra time or penalties perhaps required to separate the two teams.
"All it takes is one moment," he said. "That's why you need to play in every single moment out there... like that one moment can decide whether you win or lose.
"You need to live in every single moment because that's how small the margins are in the semi-final or final."
