The 22-year-old held a two-shot lead overnight and fired a final round six-under-par 65 at the Kuala Lumpur Golf and Country Club for an 18-under 266 total, four clear of the in-form Ko (66) who was gunning for a third straight LPGA title.
Korda, in contrast, had managed just one top 10 this year and had failed to make the cut in five of her last six events to tumble down to 50th in the world rankings and almost miss out on a spot in the field in Malaysia.
Her surprise victory against a high-caliber field in punishing humid conditions left her understandably emotional.
"Just to win again is amazing especially after the year I have had," said Korda, who began crying before holing out on the last.
The poor form led to her telling U.S. Solheim Cup skipper Juli Inskter that she wasn't worthy of a captain's pick for last month's matches against Europe which the Americans won without her.
But a new coach and some quality time back in Florida helped spark a transformation.
"Just three weeks at home with my coach and family and working a lot on physical aspects and found a love for the game back," Korda said when asked about the turnaround.
"My boyfriend and I played a lot with my sister and I just enjoyed my time at home and came here refreshed."
Korda picked up her fifth birdie of the final round on the 10th to move four-shots clear but a nervy missed short par putt on 11 and a birdie by Ko on 12 halved the deficit to two as the pressure came.
The New Zealander, though, tossed in a bogey five at the 13th to give Korda breathing space and the American, daughter of former Australia Open tennis champions Petr, confidently negotiated the tricky water-filled closing stretch.
A birdie two following a pin-point tee shot at the 15th gave her a four-shot lead again as she finished clear of Ko, defending champion Feng Shanshan of China (66) and American world number three Stacy Lewis (67).
Former world number one Yani Tseng of Taiwan continued to show promising signs of a return to form with a fifth place finish on 13-under following a closing 66.
(Writing by Patrick Johnston in Singapore; editing by Amlan Chakraborty)
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