Cowbells were clanging as 31-year-old Kueng, whose resume includes just two World Cup victories, produced a blistering run down a sun-kissed Birds of Prey track, clocking a winning time of one minute, 43.18 seconds.
"It's incredible, I had a really good run, my skis are so fast," said Kueng. "I am so happy with this day.
"When you start 19th and have the green light (top time) it is really good."
Completing a spectacular day for the Swiss, Kueng was joined on the podium by countryman Beat Feuz, who took third behind American Travis Ganong.
Ganong gave the U.S. their best result of the championships, taking silver to the delight of raucous home crowd.
It was a first world championship medal for all three men as the favourites faltered, Norway's Kjetil Jansrud, winner of three downhills this season, crossing 15th and Olympic gold medallist Matthias Mayer of Austria finishing 12th.
The Swiss-Austrian rivalry on the downhill is one of winter sport's most heated with national pride and bragging riding on every race.
Through the first week of the championships, the Swiss had taken a back seat to their alpine rivals as Austria dominated the mountain, placing skiers on every podium while taking gold in the men's and women's Super-G.
But the Austrians failed to crack the top 10 in alpine skiing' s most prestigious event on another sunny day at Beaver Creek.
Few would have tipped Kueng as a future world champion but one of his two career World Cup victories came on the same Birds of Prey layout in a Super-G in 2013, and the Swiss put his experience to good use.
Ganong, who won his first World Cup race in downhill at Santa Caterina in Italy two months ago, also knows the challenging piste well, having raced World Cup on the Birds of Prey since 2010 and collecting a career best fifth place earlier this season.
"It's perfect. This is a huge race here at home for us," said Ganong. "It's just so nice to be able to perform like this in front of our hometown crowd and do this for the country and bring a medal home.
"I pushed hard today and it worked out. An unbelievable day."
(Editing by Mark Stokes/Gene Cherry)
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