In an unusually crowded final with nine skaters, the 21-year-old took over after defending Olympic champion Charles Hamelin fell out of the lead early and incurred a penalty. Lim finished first in 2:10.485.
"I was overwhelmed because it's my home country," Lim told a news conference.
Sjinkie Knegt of the Netherlands took silver, finishing 0.70 seconds behind Lim, while Olympic Athlete from Russia Semen Elistratov won the bronze.
Hamelin, a pre-event favourite, was looking to become the first short track speed skater to win a gold medal at three different Olympic Games but the 33-year-old Canadian, who had originally finished sixth, was given a penalty for impeding.
Speaking to reporters after his disappointing performance, Hamelin said it was difficult for him to tell whether he had deserved the penalty.
"I made a mistake," he said. "It might have cost me a better position and even the race. I ended up at the back of the pack. In a race with nine skaters, you never want to end up in the back."
Earlier on Saturday, South Korea's Choi Minjeong set an Olympic record in the women's 500m with a 42.870-second finish in her heat to qualify for the quarter-finals taking place on Tuesday.
Canada's Marianne St Gelais, who won silver in the 500m in Sochi, finished first in her 500m heat with a time of 43.437 seconds. Her team mate Kim Boutin also cruised to the 500m quarter-finals by winning her heat with 43.634 seconds.
Rising American star Maame Biney held off South Korea's Kim Alang to finish second in her 500m heat behind China's Fan Kexin and qualify for the quarter-finals.
The Chinese women also set an Olympic record in the 3000m relay with 4:05.315.
(Reporting by Gabrielle Tétrault-Farber; Editing by Clare Fallon)
