The Austrian took the 127km seventh stage by half a wheel on Huber (SUI) after a lead group which also contained Ondrej Fojtik (CZE), Soren Nissen (DEN) and Brendan Johnston (AUS) spent the entire day at the front.
Fojitik claimed third with Nissen and Johnston trailing. Australian Sarah White remains the fastest women in a field that had to endure temperatures in the high thirties as it rode into the Skybury Plantation.
A lead group formed on the steep climb to Stannary Hill and rode the technical downhill sections past the first two feedzones rode together and c o-operating on the flat sections.
The last kilometre into Skybury presented a final technical singletrack section before Islitzer settled it in a sprint.
"This is a dream come true,” Islitzer said. “I’ve been racing way above my expectations at this event and I've been working really hard every day, racing with the leaders and today's win is just brilliant. I'm very happy.”
Huber who still holds a very comfortable overall lead of more than 16 minutes to Nissen, congratulated Islitzer to the stage win.
“Today I rode a tactical race. I've been dominating the lead group over the last few days and didn't want to risk anything,” Huber said.
“But the pace was very high in our lead group of five and if anyone had attacked, I would have had to react.”
The overall top five positions remain unchanged, with Nissen in second, Australia’s Johnston in third, followed by Nicholas Pettina (ITA) and Islitzer.
Stage 8 features 1400m of elevation. The 100km marathon stage will take the riders further north past the Kuranda National Park to Wetherby Station, the oldest cattle farm in Australia.