This season had been heralded as one of the greatest in the sport’s history and the title race went down to one of the most “insane” final laps possible.
Hamilton had all but won his record-breaking eighth world title until Williams Racing driver Nicholas Latifi crashed into the barriers with four laps remaining, resulting in the safety car being called out.
It meant the race restarted on the final lap, with Verstappen allowed to start almost side-by-side Hamilton, despite the Brit having established a healthy lead.
The Dutchman, on new tires, had the pace to overtake his rival and win one of the most dramatic F1 races ever.
“It’s insane. I don’t know what to say. I’m so pleased for the team and for all these guys. I love working with them so much,” an emotional and slightly stunned Verstappen, 24, said after the race.
“Finally, today, I had a bit of luck. My team know I love them and I want to do this with them for the next 10 or 15 years!”
The victory means Verstappen prevented Hamilton from surpassing the record he still shares with racing legend Michael Schumacher.
Mercedes confirmed it had lodged two protests relating to the end of the race, but both were rejected by officials later on Sunday.
The team then lodged an intention to appeal against the decision relating to restarting the race for the last lap.
A race like no other
The two titanic rivals arrived at the Yas Marina Circuit level on points, setting up the perfect end to a title race which came down to the very final moments.
The Dutchman took the early advantage by qualifying in pole position after a magical qualifying lap on Saturday, a drive that will be remembered for quite some time.
But it was Hamilton who started the race better from second, overtaking Verstappen before the first corner and dominating the majority of the Grand Prix with the Mercedes pace.
There was controversy, as there has been throughout the season, with Red Bull adamant that Hamilton should have given his first place back to Verstappen after the Mercedes man went off the track following contact with his rival.
Stewards, however, decided not to investigate the incident and allowed Hamilton to proceed in first.
Red Bull then resorted to its Plan B, with Verstappen’s teammate Sergio Pérez expertly holding up Hamilton after the Mercedes driver emerged from the pit lane in second.
The Brit finally found a way past the Red Bull but not until he had Verstappen back on his heels.
But Hamilton looked to have done enough, building up a double-digit second lead, and was cruising to victory before the mayhem of the final lap.
With the win, Verstappen finished the season on 395.5 points, while Hamilton finished second on 387.5.
Mercedes team principal Toto Wolff was left visibly furious after stewards allowed the race to finish with such drama, but Hamilton was sporting in defeat.
“Firstly, congratulations to Max and his team. I think we did an amazing job this year. The team, everyone back at the factory, all the men and women we have, worked so hard all year in a difficult season,” he said after the race.
“I am so proud of them, and so grateful to be part of the journey with them. We gave it everything this last part of the season and never gave up, that’s the most important thing.
“Of course, I have felt great in the car this past couple of months, particularly at the end. I hope everyone stays safe in the pandemic and has good Christmas during this time and we’ll see about next year.”
Meanwhile, amid the controversy, Mercedes claimed an eighth consecutive constructors’ championship but that will be little consolation to those involved.