Eduardo Vargas deftly volleyed home a cross from the right after 72 minutes that goalkeeper Jefferson got a hand to but could not stop.
Alexis Sanchez then doubled their lead in the 89th minute when he finished off a nice 1-2 with Arturo Vidal.
The goals were reward for a high-intensity performance from the Chileans, who created more chances than their visitors.
"We did what we had to do," Chilean goalkeeper Claudio Bravo said in a televised interview. "We knew that Brazil are a good team and can hit on the counter attack, and we knew how we had to play. We got three points and that's fantastic."
Neither side was able to dominate the early moments of the match, which came at the same venue where the home side won the Copa America in July.
But Chile took over as the match went on to record their first win over Brazil in the South American World Cup qualifiers since 2000.
Brazil, who were without suspended Barcelona striker Neymar and lacked direction, will aim to get back on the winning track at home to Venezuela on Tuesday, while Chile will travel to Lima to face Peru.
(Reporting by Felipe Iturrieta, writing by Andrew Downie; Editing by Greg Stutchbury)
