Uruguay is trying to become the tournament's most successful team. Paraguay is looking to prove it deserves South America's most important soccer trophy despite its poor play.
The final at Monumental Stadium in Buenos Aires will cap a tournament in which Argentina and Brazil didn't even make it past the quarterfinals. Venezuela and Peru, the usual underdogs, stayed longer than the powerhouses.
Uruguay, a World Cup semifinalist last year, has a chance to win a record 15th Copa America title, one more than host Argentina.
"We know what we are after," Uruguay coach Oscar Tabarez said. "We have a great opportunity and we are well prepared to take advantage of it. This is a final, not only the last match in a tournament. It will determine each team's place in the history of this competition."
Uruguay is trying to win its first Copa America title since hosting the tournament in 1995. It is the team's first final at a major competition since 1999, when it lost to Brazil at the Copa America in Paraguay.
The Uruguayans eliminated Argentina in a penalty-kick shootout in the quarterfinals. They then defeated Peru 2-0 in the semifinals.
Paraguay, on the other hand, has somehow found its way to the final.
"Uruguay is in the process of getting better, having played its best match in the semifinals," said Paraguay coach Gerardo Martino. "Paraguay is the complete opposite. We are getting worse."
Paraguay was badly outplayed by defending champion Brazil in the quarterfinals but held on to win in a penalty shootout. The team struggled again against Venezuela in the semifinals, winning on penalties after being saved by the woodwork three times in regulation and extra time.
Although the Paraguayans acknowledge they have been lucky, Uruguay is quick to downplay its role as heavy favorite.
"Paraguay has a lot of history and tradition in football," Tabarez said. "They are known for being able to fight against adversities. They are very physical."
Paraguay, which has played in the past four World Cups, is trying to win its third Copa America title after victories in 1953 and 1979.
President Fernando Lugo sent a support letter to the squad on Saturday, saying that "with faith, everything is possible, even in challenging times."
Martino will have problems selecting his starting lineup because of key injuries. Star striker Roque Santa Cruz and winger Aureliano Torres will definitely miss the final, and forward Nelson Haedo Valdez and midfielder Edgar Barreto are not 100 percent because of nagging ailments.
Martino won't even be allowed in the dugout. He was ejected against Venezuela when he and assistant Jorge Pautasso repeatedly argued with the referee.
The team will be anchored by goalkeeper Justo Villar, who was key for Paraguay both in the quarterfinals and semifinals.
Uruguay will be at full strength and feature Diego Forlan, who last year was voted the World Cup's best player. He scored five times in South Africa but is going through a bit of a slump, having not scored in 12 matches.
"I'm fine, we are on the right track," the Atletico de Madrid player said. "I've been having some opportunities but the ball just doesn't want to go in. But the team is playing well and that's the most important thing."
Uruguay has a squad containing 20 of the 23 players at the World Cup. That team lost to the Netherlands in the semifinals before finishing fourth.
The winner of Sunday's final earns a spot in the 2013 Confederations Cup in Brazil.
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