India, dominant throughout the tournament, made a rampant start in pursuit of 252 only to lose three wickets for 17 runs, including captain Rohit Sharma for 76 and Virat Kohli for one.
Shreyas Iyer followed for 48 and Axar Patel holed out on 29 to leave 49 runs to get from 51 balls.
Hardik Pandya took India closer and, after he fell for 18, KL Rahul finished 34 not out as Ravindra Jadeja hit the winning runs with an over to spare.
That India always still felt ahead of the game was thanks to their spinners once again impressing by limiting New Zealand to 251-7.
Victory confirms India's place as the world's premier white-ball side.
Since being beaten in the final of the 2023 World Cup they have won the T20 World Cup and the Champions Trophy - a record third time they have won this event but first since 2013.
They were loudly supported by a partisan crowd in Dubai, fireworks erupting into the night sky as the players rushed onto the field at the final moment.
"These guys are stepping up in a massive way and that's why we're such a strong team."
Captain Sharma added: "We've played some really good cricket throughout the tournament. To come out here and win it is great.
"The crowd has been magnificent. It's not our home ground but they've made it our home ground."
Watch highlights on ICC website.