The 34-year-old Aprilia rider -- who hails from Catalonia -- benefitted from a final-lap crash by two-time defending world champion Francesco Bagnaia.
Espargaro could cap a momentous week by adding the main MotoGP race on Sunday -- he did the double last year -- for which he starts on pole.
Whilst he confirmed his excellent form there was a boost for six-time world champion Marc Marquez.
The 31-year-old Ducati-Gresini rider finished second in the sprint after a poor qualifying session in which he posted only the 14th fastest time.
Championship leader Jorge Martin was not at the peak of his powers, but the Spaniard battled hard on his Ducati-Pramac to finish fourth and extend his lead in the standings.
Bagnaia looked set to reduce the lead by 12 points as he went into the final lap with a clear lead, but his hopes turned to dust on the fifth corner.
He slipped from second in the standings to fourth as Marquez and his Ducati teammate Enea Bastianini overtook him.
Marquez trails Martin by 37 points going into the sixth race of the campaign -- Bagnaia is 44 points off the pace.
Bagnaia was not the only rider to crash out, Spain's Raul Fernandez and Brad Binder of South Africa coming to grief when they also led.
Earlier Espargaro had produced a sublime performance in qualifying.
"I do not have 100 pole positions to my name," said Espargaro, who is seeking a fourth MotoGP success.
"Therefore, even if it is just the qualifying I am very happy to have achieved this at home.
"I made several errors on my first fast lap but my second is perhaps the best one of my life."
