The Classic Eight foes split regular season meetings before their rubber match in a regional final.
Oconomowoc edged Arrowhead, 43-41, to advance to Division 1 sectional play.
With the game tied at 41, senior Olivia Sobczak (6-0) was fouled on a drive and made a pair of free throws with 5.7 seconds left to lift the Raccoons to the victory.
Sobczak, a first-team WBCA all-state pick, finished with a game-high 29 points, including going a perfect 6-for-6 from the free throw line.
Junior Elizabeth Cleary added eight points for coach Bob Shea and the Raccoons.
Oconomowoc led 25-16 at the break and held off a second half rally by Arrowhead.
The Warhawks were led by senior Maddie Walsh, a 6-foot-2 UAB signee, who finished with 12 points.
Junior Phoebe Frentzel contributed 10 points in the loss for coach Rick Witte and the Warhawks.
Oconomowoc would go on to defeat Milwaukee King and Kettle Moraine in sectional play to reach the state tournament for the first time in program history.
The Raccoons were set to play top-seed Middleton in a Division 1 state semifinal before the tournament was canceled. They finished the year with a 22-4 record.