Pettersen fired a bogey-free, six-under-par 66 in her final round to overcome overnight leader Inbee Park of South Korea by one stroke.
Park had led by two after the third round but fell behind early on the last day.
She rallied with four birdies in five holes around the turn but a bogey on the 15th left her two behind and unable to catch up despite a birdie at the 18th.
Pettersen chipped from the side of the 18th green and took two putts to claim her 16th worldwide tournament victory and her sixth Ladies European Tour title. Petterson, who finished on 18 under, said: "I knew it would take the best to get this trophy but I was really keen on winning this tournament and it sets me up for a good start for this new year.
"I know Inbee is in there and if she just gets one look at a putt, it's in, so I had to bring my best and the putter was hot today [Sunday]."
China's world number five Shanshan Feng, winner in 2012, finished third on 11 under.
The consolation for Park was that she and Kim Ha-neul claimed victory for Korea in the team competition, finishing with a combined total of 560, 16 under par.