Federer was hoping to match world number one Novak Djokovic, who began his 2016 campaign with a "perfect" performance to claim the Doha title 24 hours earlier, but came up well short.
The 34-year-old Swiss maestro had started the week with a flu bug, improving each round until he came up against fourth seed Raonic in the final on the Pat Rafter Arena, losing 6-4 6-4.
"I've still got a cough and the throat is a bit weird," he told reporters after his defeat.
Federer struggled with his first service throughout, facing and saving two break points in the fifth game before Raonic made the breakthrough on his second opportunity in the ninth.
He served it out to take the opener in 41 minutes and the same pattern continued in the second set.
Federer managed just one break point as Raonic served four double faults in the fourth game after having a medical time out for a right leg injury.
The 17-time grand slam champion could not take advantage of the fleeting chance and was broken himself in the seventh game.
Raonic claimed the title when Federer hit a backhand long, an immediate boost to his fortunes after a disappointing 2015 campaign, which saw him suffer with foot and back injuries.
It was his eight career crown and revenge for a three-set defeat to Federer in last year's final in Brisbane.
In an added twist, Raonic's former coach Ivan Ljubicic has taken over the same duties with Federer, the Croat watching his defeat from a courtside box.
Raonic has paired up with former world number one Carlos Moya, who will be part of his team for the opening grand slam of the season in Melbourne.
Reigning Australian Open champion Djokovic could hardly have had a better to his campaign to retain his title as he dispatched Spain's Rafael Nadal 6-1 6-2 in the Qatar Open final Saturday.
Nadal detained his arch-rival on court for just 73 minutes and has slipped behind in their head to head battle for the first time, Djokovic with 24 wins from 47 matches.
It was the Serbian's 60th career title and after not dropping a set all week acknowledged that he could not be in finer fettle.
"I played pretty much perfect tennis today from the very beginning I managed to get every shot the way I wanted," said Djokovic told gathered reporters.
"When it was most needed against one of my biggest rivals, I managed to play the best tennis in a match where I fought for the trophy. So it does definitely give me a great deal of confidence for the rest of the season.
"I'm playing the tennis of my life, and I will try to nurture and cherish those moments on the court.," he added.
A dejected Nadal could only force one break point and was on the receiving end of 30 winners.
"I played against a player who did everything perfect. I know nobody playing tennis like this ever. Since I know this sport I never saw somebody playing at this level," was his verdict.
"The only thing that you can do is wait that the opponent is not playing like this all the time. That is difficult to play like this all the time. It's obvious. I am going to wait for my moment."
Stan the man
Meanwhile, in India, Federer's compatriot and world number four Stanislas Wawrinka won the Chennai Open for the third straight year with a 6-3 7-5 victory over 19-year-old Croatian Borna Coric in Sunday's final.
Wawrinka, the only man to beat Djokovic in a grand slam last year, upsetting him in the final of the French Open, did not drop a set all week, but was extended by the promising Coric, who was playing his first ATP Tour final.
He is the ninth different active player to achieve the hat-trick of wins at the same tournament, winning his 11th career title and fourth in Chennai in eight appearances.
It was excellent preparation for the Australian Open, which Wawrinka won in 2014, beating Nadal in the final.