In an electrifying upset at a rainswept Stade de France, the 23-year-old stunned the USA's reigning 100m world champion Sha'Carri Richardson with a barnstorming performance to take gold in 10.72sec.
Alfred led from start to finish to power home well clear of Richardson, who took silver in 10.87sec, with fellow American Melissa Jefferson, third in 10.92sec.
Richardson had been hotly tipped to become the first American to win the coveted Olympic crown since Gail Devers in 1996.
But the 24-year-old Texan's dreams of victory were utterly eclipsed by Alfred's magical victory.
Alfred later choked back tears as she paid tribute to her late father, who died in 2013, while recalling her childhood dreams of one day running in the Olympics.
"He believed that I could do it," Alfred said of her father. "He passed away in 2013, and he couldn't get to see me on the biggest stage of my career.
"But I know he will always be so boastful of his daughter being an Olympian and now this happened."
Running barefoot
"Growing up I used to be on the field struggling with no shoes running barefoot, running in my school uniform, running all over the place."
Alfred, who honed her craft at the University of Texas, hopes Saturday's victory will improve track and field facilities in her native St. Lucia.
"We barely have the right facilities," she said. "The stadium is not fixed. I'm really hoping this gold medal will also help the youth and help St Lucia build a new stadium and really help the sport grow."
Alfred's gold gave St. Lucia their first ever medal of any colour at an Olympics. The island nation only began competing at the Games in 1996.
It was an incredible performance by Alfred, who had fired a warning shot across Richardson's bows in the semi-finals, finishing ahead of the American in 10.89sec.
The semi-final proved to be an ominous portent for Richardson, who was slow out of the blocks and never looked like reeling in Alfred, who could even afford to ease up as she crossed the line to clinch gold.
Alfred was in tears of celebration after sealing her win, running to ring the trackside victory bell before wrapping herself in her country's flag and embracing her American rivals amid a deafening roar from the appreciative Parisian crowd as she set off on her lap of honor.
Richardson meanwhile was left wondering what had gone wrong with an Olympics campaign that had promised to deliver a gold.
The American, who upset the odds to win gold at last year's World Championships in Budapest, had been hoping to complete her journey to the pinnacle of her sport.
The American had framed her campaign in Paris as a bid for redemption, coming three years after she was barred from competing at the Tokyo Olympics after testing positive for marijuana as she grieved the death of her biological mother.
And in the build-up to the Games, the stars appeared to be aligning in favour of the flamboyant world champion, with Jamaica's defending Olympic champion Elaine Thompson-Herah ruled out through injury, and another Jamaican medal hope, Shericka Jackson, opting to drop out of the 100m to concentrate on the 200m.
Richardson received another boost earlier Saturday in the semi-finals, when two-time Jamaican Olympic champion Shelly-Ann Fraser-Pryce withdrew from the semi-finals after suffering a reported injury during a warm-up.
But any hope that fate was smiling on Richardson was snuffed out by the imperious Alfred, who was never going to be denied as she hammered down the rain-slicked track to claim St. Lucia's maiden Olympic medal.
