The four-year-old Found, who started at 6-1, took the lead from pacesetter Vedevani in the final 400 metres after being kept in good position from the start by Ryan Moore -- winner of the Arc de Triomphe in 2010.
Highland Reel finished second ahead of Order Of St George, ridden by last year's winner Frankie Dettori.
"I’m so delighted for everyone. It’s a big team effort. It’s a privilege to be here and be part of it," said O'Brien. "How can you see anything higher than this? I couldn’t dream this would happen. You know how difficult the Arc is.
"She has only run over a mile and a half four times before and she was unlucky in the Arc last year. We’ve had our eye on this for a long time. When Ryan rode her as a two-year-old and said she could win an Arc - he was obviously right."
Pre-race favourite Postponed, unbeaten this season, ended up a disappointing fifth.
(Reporting by Julien Pretot, editing by Pritha Sarkar)
