An imperious Djokovic stormed to the first set in just 31 minutes, firing 11 winners to Murray's three as he broke the Scot's serve on two occasions.
But Murray responded in the second, securing the vital break in the fourth game before keeping his nerve to hold serve and tie the match.
Both players exchanged breaks at the start of the decider before Djokovic made the crucial breakthrough in the sixth game to take a 4-2 lead.
Yet that was far from the end of matters.
The Serb had to save seven break-back points in his final service game before snuffing out Murray's challenge and securing victory.
"It was such an intense match," Djokovic later told reporters. "I started well, but had a slow start in the second. Andy also changed his game to take advantage."
"I don't know how I dug my way out, but that's how it happens when you play against one of the best in the world. I'm just happy to have overcome this challenge," he added.
Another Nole record
Murray was defending the crown he won in the Spanish capital last year.
But despite securing an impressive victory over home-favorite Rafael Nadal in Saturday's semifinal, he couldn't match the all round game of Djokovic.
Murray won only 32% of points on his second serve compared to Djokovic's 52% and made 33 unforced errors to his opponent's 25.
The result also means Murray cedes his position as the world's number two ranked player to Roger Federer.
Djokovic's triumph, meanwhile, means he has now claimed a record 29 career ATP 100 Masters titles, one more than Nadal.
Both players will appear in the Rome Masters next week before progressing to the French Open at Roland Garros.
The year's second grand slam begins on May 16 and is the only tennis major that Djokovic has yet to win.