With the win, Morang also avenged last year's 1-0 defeat in the same tournament.
Bijay Dhimal, Dipak Rai and Repesh KC netted a goal each for Morang, while Shiva Shrestha scored the consolation goal for Rupandehi.
Two brothers Bijay and Rajin Dhimal of Urlabari, Morang have been playing for the district club.
Bijay gave Morang the lead in the 32nd minute scoring from the danger zone, while skipper Dipak doubled the advantage in the 49th minute scoring from the box utilizing Bijay's cross.
However, Rupandehi's Shiva cut the deficit in the 57th minute through spot kick that he earned after Chico of Morang fouled Victor inside the box.
However, Rupesh secured Morang's victory making it 3-1 in the 79th minute.
Rupesh scored the final goal after a shot from Nirajan Khadka in one-on-one situation was rebounded hitting Rupandehi goalie Dilip Chhetri.
Besides that, Morang failed on a number of occasions, including Martin's powerful shot being denied by Rupandehi goalkeeper, while Dona Thapa's shot rebounded hitting the bar.
Similarly, Rupandehi's Segun failed to give early lead as his header was denied by Morang goalkeeper and Praveen Saiju's shot in the 51st minute deflected out after hitting the goal post.
Despite the victory, Morang coach Sanjib Budhathoki lamented that his side did not perform as expected.
"We were under pressure as our players wasted too many opportunities," said Budhathoki after the match.
Similarly, Rupandehi coach Dayaram Sapkota said that both teams played 'equal' game but his side lost as players did not utilize goal scoring chances.
"We created numbers of chances but failed to execute them and faced the defeat," Sapkota added.
Rumpum Jhapa XI will face George Telegraph Kolkata of India on Saturday.
Morang into quarterfinal