The Oakland cornerback high-stepped for the final 25 yards of his 90-yard interception return that started the Raiders on a 27-0 rout of the Miami Dolphins on Saturday.
The victory sent Oakland to the AFC championship game for the first time since the 1990 season.
"Before I go to sleep, I always visualize making plays," James said. "It seems like today my dreams came true."
Rich Gannon completed 12 of 18 passes for 143 yards and a touchdown. Tyrone Wheatley ran for another score and rookie Sebastian Janikowski kicked two field goals.
It was the latest postseason humiliation for the Dolphins, who have been beaten by the combined score of 127-10 at this stage of playoffs the last three years.
"Every team has its cross to bear, its hurdle to get over," receiver Oronde Gadsden said. "The second round of the playoffs is ours."
Jay Fiedler was 18-of-38 for 176 yards and three interceptions for Miami.
The Raiders couldn't get much done offensively on their first series, so their defense helped out on Miami's first possession.
"After going three-and-out on the first series, I sagged," Oakland coach Jon Gruden said. "Next thing you know, old No. 20 is down the sidelines."
It was the first career touchdown for James, a five-year NFL veteran in his first season with the Raiders. He added another interception in the fourth quarter.
Oakland went up 10-0 on Janikowski's 36-yard field goal with 4:52 left in the first quarter. He added a 33-yard field goal midway through the second quarter.
Janikowski, the 17th pick overall and the only kicker taken in the first round since 1979, has hit 18 of his last 22 field goal attempts. His 58-yard field goal attempt at the end of the first half fell short.
The Dolphins' sixth-ranked defense couldn't stop the pumped-up Raiders, who had not hosted a playoff game in Oakland since 1980.
In the first half alone, Gannon completed 10-of-13 passes for 117 yards. In the second half, the Raiders' top-rated rushing offense took over.
Wheatley, the Raiders' top back with 242 carries for a career-high 1,046 yards and nine touchdowns in the regular season, scored from two yards out with 5:56 left in the third quarter.
Gannon, named to the Pro Bowl and the All-Pro Team, ran five times for four first downs.
James, who had been obscured by the skills of Woodson and Eric Allen, almost added another touchdown as well.
Late in the third quarter, the ball was knocked from Fiedler's hands in what appeared to be a fumble. James scooped up the ball and ran it back 47 yards into the end zone again accompanied by Woodson.
But Fieder's throw was ruled an incomplete pass, negating James' effort.
The Raiders' defense effectively shut down Smith, who came into the game with 13 touchdowns in Miami's last 10 games. He finished with eight carries for four yards, a week after rushing for 209 yards on a playoff-record 40 carries.
Gadsden, Miami's top receiver, managed just one catch for 33 yards.
After the game, Gruden sprinted across the field and high-fived end zone fans in Oakland's infamous Black Hole.
"We're proud to be part of a good season," he said. "We'd like to make it a great season."
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