The Frenchwoman benefited from an inadvertent lead-out from defending champion Marianne Vos, sprinting to victory ahead of time trial world champion Lisa Brennauer (Germany) and Emma Johansson (Sweden) in a photo finish.
Australia's Tiffany Cromwell finished strongly in fifth, after a select group of 14 riders contested the finish together.
Vos launched her sprint with 300 metres to go, in response to the threat from Giorgia Bronzini (Italy). As Vos tired, Ferrand-Prevot catapulted off her wheel in perfect timing to claim the rainbow jersey.
The win caps a stellar season for the 22-year-old Rabo Liv rider who also won La Fleche Wallonne and holds French national titles in the road race and individual time trial, and cross disciplines too, in both cyclo-cross and mountain bike.
"I was not with the front four at the top of the climb, but we came back to them with one kilometre to go. I sprinted, and I didn't know I had won it first. It's fantastic," said Ferrand-Prevot who was still trying to come to terms with the win.
"Honestly, I didn't expect to be on the front today - I crashed on Sunday, and I felt really bad this week. I did the race, but I only expected a top 10, so to win, I am really happy."
Johansson, who was runner-up last year and also won bronze in 2010, admitted she wasn't surprised to see the Frenchwoman winning a sprint, but was impressed the French star had made the split over the last climb.
"I've seen Pauline has really stepped up as a top rider this year, she's done really amazing results. I was surprised she wasn't with us over the top of the climb," said Johansson.
"I'm surprised that she's won - but also not - as she's been a really strong rider this year."
A massive crash disrupted the 127km race on lap two, with a domino effect seeing much of the field touching the tarmac. It was to spell the end of the race for more than a dozen riders, including three from the Belgian team and Australia's Lizzie Williams.
The peloton eased off the pace to enable those able those held up by the crash, including defending champion Vos and favourite Bronzini, to rejoin the race,
Slovenia's Spela Kern made a solo move with 66km to go, putting 40 seconds between herself and the peloton, however her advantage was nullified by the peloton 16km later.
With the field was all together with two laps to go, American Alison Powers tested the peloton through the feed-zone, but her moment in front was short lived.
Australia's Rachel Neylan attacked on the penultimate climb with 17km to go. She drew out her lead to 10 seconds until she was caught by a select group on the crest of the climb, having successfully thinned the peloton.
The final lap saw a constant barrage of attacks, as time and again riders attempted to break free, with Germany's Trixi Worrack the main protagonist. American Evelyn Stevens put in a big turn at the front, but with only the fittest riders left in contention she could not cause a lasting split.
With the kilometres ticking away and the finish line rapidly approaching, Johannson, who'd been quiet for much of the race, attacked with five kilometres to go. Her acceleration could only be matched by Vos, Lizzie Armitstead (Great Britain) and Elisa Long-Borghini (Italy).
Four kilometres from the line the quartet held only a 12 second lead over a strong chase group, with Ferrand-Prevot in the gap between.
As they women marked each other in the final kilometres, the chase group, which included Ferrand-Prevot, Bronzini and Cromwell, came together, to force a sprint finale.
Elite Women: 127km, Ponferrada
1 Pauline Ferrand Prevot (FRA) 3hr 29min 21sec
2 Lisa Brennauer (GER)
3 Emma Johansson (SWE)
4 Giorgia Bronzini (ITA)
5 Tiffany Cromwell (AUS)
6 Shelley Olds (USA)
7 Elizabeth Armitstead (GBR)
8 Linda Villumsen (NZL)
9 Anna Solovey (UKR)
10 Marianne Vos (NED)
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.