The Olympic champion, who finished second to Martin in 2011 and 2013, was 26 seconds faster than the German, completing the 47.1km course in 56min 25sec.
Dutchman Tom Dumoulin finished third, 40 seconds behind Wiggins.
A strong performance by Australia's Rohan Dennis saw the BMC rider finish fifth, 57 seconds down.
As defending champion, Martin was the last rider to start. The Omega Pharma-QuickStep rider took an early lead, however Wiggins responded by consistently drawing out his advantage over the remainder of the course.
"I knew coming into it that I had the legs, and once I saw the course I realised that if I was ever going to beat Tony it was on a course like this," said the Brit who adds the world title to his British and Olympic titles.
"I've been through this so many times in the past, when I know the form and condition is there, I'm quite relaxed. I had a good team time trial on Sunday, I knew I was strong.
"I knew the difference would be made on the final loop, with the very tough climbs after the course already. I paced it perfectly and I still had gas in the final. Even on the last descent, I heard I was 10 seconds up, I was just pushing it all the way. I didn't want to take any risks."
It was Portugese time trial champion Nelson Oliveira who was the first rider to go inside 58 minutes with a time of 57min 47sec. With the big names still to start the race, the hot seat was Oliveria's for a while.
France's Sylvain Chavanel set the benchmark through the first time check at 12.23km, with only Wiggins and Martin able to better his time. Martin led by four seconds over Wiggins at this early point in the race.
As they headed towards checkpoint two at 23.2km, Dennis picked up the pace, setting the new fastest time of 26min 50sec. Wiggins then flew through the time check seven seconds faster than Dennis, and two seconds faster than Martin, having gained six seconds on Martin in less than 12 kilometres.
Wiggins increased his tempo to be up on Martin by nine seconds at the 35.28km mark.
It was Vasil Kiriyienka (Belarus) who was the first to knock Oliveira from the hot seat, but his turn was short-lived with Tom Dumoulin setting the new fastest time.
Dennis came home in a time of 57min 23sec to slot into second with four riders still to finish. With each subsequent rider able to better his time, Dennis finished fifth overall.
Wiggins continued to pull away from Martin, building a buffer of over 20 seconds on the final kilometres to win the rainbow jersey and rectify his season after missing out on the Tour de France.
Elite Men's Time Trial: 47.1km, Ponferrada
1 Bradley Wiggins (GBR) 56min 25sec
2 Tony Martin (GER) 0:00:26
3 Tom Dumoulin (NED) 0:00:40
4 Vasil Kiryienka (BLR) 0:00:47
5 Rohan Dennis (AUS) 0:00:57
6 Adriano Malori (ITA) 0:01:11
7 Nelson Olivira (POR) 0:01:21
8 Anton Vorobyev (RUS) 0:01:29
9 Jan Barta (CZE) 0:01:43
10 Jonathan Castroveijo (ESP) 0:01:44
The first five days of the UCI Road World Championships will be live-streamed on the Cycling Central website, while the final two days will be broadcast on SBS ONE and streamed online.