Lynn paid for missed chances as they bow out of the FA Trophy on penalties for the third successive year.
Manager Tommy Widdrington made two changes for the visit of the Tudors with a first start for Ken Charles whose spell on loan to Cheshunt had seen him net five times in six appearances including a hat trick against Chippenham.
Josh Barrett was the other addition to the starting line-up with Kyle Callan-McFadden and Tyler Denton dropping to the bench.
A lively start saw Hemel with the first chance with Jernade Meade getting a shot in after a quick break but Paul Jones was equal to it.
Lynn responded with a number of chances of their own. Gold Omotayo had a shot well saved by Craig King and then Josh Barrett tried a trademark effort from some 50 yards with King rushing back to save.
The 13th minute was unlucky for King when then Tudor's defence failed to deal with a cross and Charles was on hand to volley home from Omotayo's head-on for his first goal of the season.
The remaining first half chances fell to Lynn with King denying Omotayo while a Barrett free kick into the box was missed by everyone.
With the seconds of the first half ticking away, Charles took advantage of a hesitant defence to get a shot in but it took a deflection and cannoned off the bar before Omotayo put the ball over.
Hemel came more into the game after the break but the real chances were from Lynn with Charles again hitting the bar and having an effort narrowly wide on the hour mark.
Fourteen minutes later it was Omotayo's turn to hit the bar with King saving the effort from the rebound.
With Lynn happy to run down the clock, the Tudors sensed that the game was not over and Florent Bojat beat Jones only to see his effort go wide and in the final minute of normal time Brooklyn Ilunga put a powerful shot just over.
With the game well into injury time Hemel won a corner and King joined the attack and headed home thanks to a deflection and a bounce to send the game to a penalty shootout.
Lynn: P Jones, A Jones, Scott, Crowther, Coulson, Hargreaves, Clunan, Barrett (Walker 79), Charles (Callan-McFadden 88), Omotayo, Stephens (Oxlade-Chamberlain 53). Subs: Oxlade-Chamberlain, Callan-McFadden, Walker, Denton, Knowles, Hudson, Fleming. Scorer: Charles 14
Hemel: King, O’Connor, Meade (Obi 70), Brown, Lelan, Roberts, Dada (Bojaj 53), Morgan-Griffiths, Holness (Holt 80), Castiglione, Ilunga. Subs: Poku, Obi, Eleftheriou, Westbrook, Holt, Bojaj, Ajayi. Booked: Roberts, O’Connor, King. Lelan. Scorer: King 90+5
Penalties: Lynn lose 4-5
, A Jones