Whitlock produced a series of gravity-defying tumbles to win gold with a score of 15.633, while Brazilian Diego Hypolito burst into tears of joy as he claimed silver, delighting the partisan crowd and making up for his flops at the last two Games.
There was more happiness for the home fans as Arthur Mariano picked up the bronze.
Shirai had been the favourite to become the first Japanese gymnast to win the floor exercise since Sawao Kato in 1968, but his gold medal hopes looked shaky when he almost sat down following a triple twisting front somersault.
When he stumbled forward following his next tumbling pass, he was completely out of the running for a medal.
But given the difficulty of Shirai's routine, Whitlock was still unsure where the 19-year-old would end up in the pecking order and he sat with his head down, jiggling nervously with his feet as he waited for the scoreboard to flash up his rival's result.
The crowd's main concern was that no one would leapfrog sentimental favourite Hypolito or Mariano.
Chants of "Diego, Diego, Diego" were ringing around the arena when the final contender, Sam Mikulak of the United States, began his routine. Wild cheers erupted as he stumbled following his first tumbling run.
That set off the celebrations for the Brazilian crowd and the tears freely flowed down Hypolito's face as he finally got on the Olympic podium following years of pain and disappointment.
All around champion Kohei Uchimura was fifth.
(Reporting by Pritha Sarkar, additional reporting by Mark Trevelyan; Editing by Ed Osmond and Bill Rigby)
