The team failed to qualify following their failure to finish their heat after a fall on Thursday, ending Oscar Pistorius's historic Olympic campaign.
Teammate Ofentse Mogawane crashed heavily on the final bend of the second leg as two-time Paralympian Pistorius, the first double amputee to compete in Olympic athletics, waited to take the baton.
A jury of appeal said South Africa "had been severely damaged" in the collision between Mogawane and a Kenyan runner, who cut across him too soon in the second section of the race. The jury of appeal decided to give the extra ninth lane to South Africa – silver medallists at the last world championships – for Friday's final.
"The jury of appeal met and agreed to advance the South African team to the final, even though they did not finish the race, considering that they had been severely damaged in the incident with Kenya," the International Association of Athletics Federations said in a statement. "South Africa will run as an additional team in lane nine."
It is rare for a team to get reinstated if it doesn't reach the finish line.
Mogawane had moved South Africa up from seventh to fifth on the leg, but rounding the bend into the final stretch, he ran into the back of Vincent Kiilu and both came to grief.
Shaun de Jager ran the first leg and was in fifth position when he exchanged the baton with Mogawane for the second lap.
The quartet of De Jager, Mogawane, Oscar Pistorius and Willie de Beer felt crushed after Mogawane stumbled near the 300m mark.
"I just saw myself falling and tumbling and landed on my shoulder and dislocated my shoulder,” Mogawane said, his left arm in a sling. "We were all bunched together and, in the last 100m, everybody wants to make a move and I was too close to the Kenyan guy.
Mogawane's initial reaction was that he thought it was just an accident.
"I wanted to make my move because he's short and I am tall. I'm running with long strides, he's running with short strides and I wanted to overtake him. Then I bumped into his leg and that is what caused the accident."
Pistorius put his hands to his head, walked to the side of the track and sank to his knees, staring down the straight. Mogawane received medical attention and left clutching his left shoulder.
"It's very disappointing, especially coming off second place in the world championships last year," said Pistorius, who runs on specially constructed carbon fibre blades. "We're pretty gutted. We've been training as a group for the last five or six years."
'Things do happen'
Mogawane's injury has opened the door for 400m hurdler LJ van Zyl to compete in the 4x400m relay final, after he crashed out of his specialist event last Friday.
Van Zyl said his bags were already packed for his trip back to South Africa after his failure in the hurdles.
Pistorius, who was joined in London by his 89-year-old grandmother who cared for him and his brother and sister after their mother died 10 years ago, said he hadn't seen what had taken place.
"I took my eyes off the screen when he rounded the bend so I didn't see what happened. I was just waiting for the baton," said Pistorius, who will return to the city for the Paralympics later this month.
"I don't know if he got spiked or caught up. He's a phenomenal athlete. I feel sorry for my teammates. Things do happen in relays."
He also admitted it was tough to see his adventure end in such an anti-climactic manner.
"It's so hard, especially with the crowd being so amazing and there being so much support back home," he said.
Pistorius (25) who had only learned on the eve of the relay he would be running in his preferred third leg spot, made history last Saturday when he made his Olympics debut in the individual 400m.
The South African, who had both his legs amputated below the knee before he was one, because of a congenital condition, had fought a long battle to be allowed to compete.
Pistorius competed in the Athens 2004 and Beijing 2008 Paralympics.
He was given the green light for the Olympics following studies that found his prosthetics give him no advantage over his able-bodied rivals. – Sapa, AFP