The oldest woman in the field by seven years, Armstrong mastered Rio's wet and windy conditions to secure a remarkable third successive Olympic title.
Armstrong's victory quickly became a family affair as she capped off perfect day, embracing her five-year-old son Lucas at the finish line.
In Sunday's road race, Armstrong had tried to help Mara Abott win gold only for her fellow American cyclist to slip from first to fourth place over the final 150 meters of Sunday's road race.
"I don't have words to describe it," said Armstrong, who shed tears of joy at the top of the podium.
"When you've already been two times at the pinnacle of the sport, why risk coming back for the gold medal?
"The best answer I can give is that I can. Today the stars aligned. I knew it was going to be a close race. My coach said to me, 'OK, you decide what color medal you want to have.'
"I dug so deep. I thought about Mara fourth in women's road race), and I gave everything for her in the final 5km."
Armstrong's gold was Team USA's 10th of the Games.
"To hear the national anthem on the podium," she added, "that's my favorite part of the Olympics."
The silver went to Russia's Olga Zabelinskaya, who took bronze in the time trial and road race four years ago before failing a drugs test in July 2014 and serving an 18-month ban.
"I'm very happy, but of course, I am also disappointed that I could not win the gold medal because it is only five seconds to first place," said the 36-year-old Russian. "I'm happy to get the medal, anyway.
"It's very important, because it's the Olympic Games. It's important for me, and for Russia."
Dutchwoman Anna Van Der Breggen finished in the bronze medal position after taking gold in the road race.
Her compatriot Annemiek Van Vleuten was leading the road race with 11 kilometers to go before suffering a heavy concussion and three minor spinal fractures in a sickening crash.
Van Vleuten was released from hospital Tuesday and Van Der Breggen admitted it had been a difficult time for the team.
"It's really been emotional here for us after what happened in the road race," she said. "Everyone gave it their all. It's very emotional that I win the medal again."
Meanwhile Switzerland's Fabian Cancellara ensured a golden end to his career by winning the men's race.
The 35-year-old finished 47 seconds clear of Frenchman Tom Dumoulin with Tour de France winner having to settle for the bronze medal for the second successive Games.
Cancellara will retire at the end of the 2016 season and he marked his final year in the sport by repeating the success he enjoyed at Beijing 2008.
"It's everyone's own choice when they want to retire," said Cancellara. "I knew it would be a special year. I've had many highlights, with the classics, then the Tour de France in Switzerland, and then the Olympic Games.
"I am just thankful that I came here healthy, because this is what you need to have. I am super proud. Just reaching this today means so much to me. To win a gold medal in your retirement year, I am super proud. This will leave me without any doubt about retiring."
Froome was trying to emulate compatriot Bradley Wiggins by completing the Tour de France and Olympic trial double.
But he admitted that Cancellara was the better rider on the day.
"Personally, I am very happy with the medal again," said the Kenyan-born Briton.
"The focus of my season this year was the Tour de France, so to come back to the Olympics, to medal for a second time, is an amazing feeling. I've got no regrets. I gave it everything today."