Yamaha's double former world champion Jorge Lorenzo claimed victory on the day 1.638 seconds ahead of Marquez, who overtook Rossi with eight laps remaining and held off the Italian to secure the title. Pedrosa finished fourth.
It was the second consecutive win for Spaniard Lorenzo after his victory in the rain-hit Aragon Grand Prix last month.
Catalan Marquez continues to blaze a trail through every class he has raced in, first winning the 125cc title in 2010, then the Moto2 crown in 2012 before claiming back-to-back MotoGP titles.
He could have settled the championship earlier in the season after registering a record-equalling 10 consecutive wins but crashes in San Marino and Alcaniz in the last two races delayed his coronation.
"It's difficult to explain right now but I have been in MotoGP for two years and won two titles. It is incredible and something I could not have imagined," Marquez said, adding that he was under pressure after the last two crashes.
"I am in like a dream, it's incredible."
BRAKING POINTS
Starting from fourth on the grid with Rossi and Pedrosa ahead of him, the Honda rider made a decent start and overtook Yamaha's Pol Espargaro, Pedrosa and Andrea Iannone of Pramac Racing in the opening laps to get closer to the front group.
He then passed Ducati's Andrea Dovizioso, who had started on pole, and overtook Rossi on the second attempt after a gripping three-lap duel to climb up into second position.
"Maybe I was not riding like always. I don't know why but the body felt different," Marquez said.
"For me it was more difficult to overtake at the braking points because I didn't want to make another mistake because of what happened in the last race."
Rossi tried a late assault to stay in the championship hunt but Marquez was too quick.
"I had a chance to keep the party open for the championship. I tried as hard as I could to keep the battle with Marc going for another race," Rossi said. "I had good pace but Marc had a little extra."
Marquez, who last year became the youngest MotoGP world champion at the age of 20, stopped on his victory lap and was presented with a ceremonial sword by a Samurai warrior flanked by a pair of kimono-clad female assistants.
He waved the sword above his head towards his supporters before returning it to the Samurai and remounting his bike to complete the lap of honour.
The Spaniard took his season tally to 312 points with Rossi and Pedrosa on 230. Lorenzo is fourth, three points further adrift. A race win is worth 25 points.
(This version of the story corrects number of consecutive wins to 10 from 11)
(Writing by Sudipto Ganguly in Mumbai; Editing by John O'Brien)
