Second-quarter goals from Holly Hunt and Tess Howard delivered glory for England's women less than 24 hours after the men had suffered semi-final despair at the hands of Australia.
Ambrosia Malone struck a consolation for Australia inside the final 20 seconds.
England, one place below Australia at fourth in the world rankings, came into the gold-medal match as slight underdogs, but the Hockeyroos were outthought, outfought and outplayed by tenacious hosts.
The capacity crowd at the University of Birmingham Hockey Centre lapped up every moment on a scorching afternoon, raising the decibels to record levels as the final seconds were counted down.
Australia had pedigree on their side having won four of the six Commonwealth Games editions, while England were three-time silver medallists.
The Hockeyroos were also unbeaten in eight games against England, a run stretching back to 2013.
Both sides needed shoot-outs to get through to the final, with their success at this tournament built on solid defensive foundations.
Flora Peel had the first attempt to Australia goalkeeper Aleisha Power, but the contest soon settled into a tactical battle with neither side finding any momentum.
England's first penalty corner saw the visitors lose their video referral after Australia had claimed that the ball was played too high towards one of their players.
It was the first of a series of three England penalty corners, but Grace Balsdon could not find way a past Power.
Goalkeeper Maddie Hinch was unemployed at the other end with the semi-final shoot-out hero not touching the ball once in the first quarter.
England's growing superiority told when Peel crossed from the right and Hunt controlled smartly to smash home.
It was only the second goal Australia had conceded at these Games.
The third did not take long with Peel the provider again for England's second, this time popping up on the left to set up Howard's clever finish.
Australia knew they had to show more attacking intent in the second half, but England were happy to drop deep and defend in numbers.
Hinch was well protected by a white-shirted wall in front of her, although she did have to punch away a ball that looped into the air and towards her goal.
Anna Toman almost put the issue beyond doubt with a penalty corner that cannoned off a post.
Hinch made her first save of note at the start of the fourth quarter to deny Hockeyroos captain Jane-Anne Claxton.
Australia turned the screw in the final moments and Hinch saved from Shanea Tonkin and Mariah Williams before Malone fired home.
But Australia ran out of time and England's long wait for gold was finally over.