It is his first stage win in the Tour and follows his season-opening win last Sunday night at the People's Choice Classic street race, held two days before the race started.
As the temperature reached the mid-40s through the Adelaide Hills on Friday, Sagan was in a select front group of 25 that contested the finish.
Sagan said the stage was "very hard" and cut his TV interview short soon after finishing.
"I'm very happy, but I have to eat first," he said.
It is the first time a reigning world champion has led the Tour Down Under.
Sagan was asked if he could stay at the front again in Saturday's crucial Queen stage at Willunga, which features a summit finish and possibly hold the lead through to Sunday's finish.
The superstar pointed to his Australian BORA-hansgrohe teammate Jay McCarthy, who also finished among the leaders on Friday to stay in contention.
"For sure, tomorrow is going to be a different story," Sagan said.
The front group formed on the key Norton Summit climb near the end of the 128.2km stage from suburban Norwood to Uraidla.
Previous race leader Caleb Ewan (Mitchelton-Scott) was dropped well before the finish.
Defending champion Richie Porte was also in the front group and his BMC teammates Miles Scotson and Simon Gerrans drove the pace up Norton Summit.
After the climb, Sagan was among several riders who tried attacks in the 7km run to the finish.
But it came down to the bunch sprint and the three-time defending world champion showed his class.
The BORA-hansgrohe rider won the sprint ahead of Daryl Impey (Mitchelton-Scott) and now leads him by two seconds on the overall standings.
Porte finished among the leaders, but is outside the top 10 in the overall standings ahead of Saturday's stage.
The Tasmanian has won the past four Willunga stages and aims to become the first champion in the Tour's' 20-year history to defend his title.
Zak Dempster led by himself for about 30km, after he and UniSA teammate Alex Porter formed the day's breakaway.
But Dempster was never going to stay clear and he was caught less than 20km before the finish.