Saunders edged the early rounds against an untested challenger, who was lacking in urgency, but Eubank Jr came on strong in the closing stages, unsettling the champion with a determined assault.
But he could not find a stoppage against Saunders, who kept his composure to earn victory with scores of 115-114, 115-113, while a third judge scored it 116-113 to Eubank Jr, who suffered his first professional defeat.
Saunders simmered with anger in the build-up, but adopted a calmer approach in the first-round, working behind a probing jab.
His opponent, with his famous father watching from ringside, simply stalked Saunders in the second and was picked off by more accurate punches from the Hatfield man.
Eubank Jr finally found his range with some body shots in the third, but Saunders replied with a lightning left, while yet more jabs appeared to edge the fourth in his favour.
With the rounds slipping away, Eubank Jr offered little except a few taunts in a scrappy fifth. ??
But the Brighton man finally shed his subdued approach in the sixth. A string of hooks and uppercuts suddenly sent Saunders into reverse and stiff jabs prompted the familiar calls of his surname from the crowd.
Eubank Jr was gradually dragging his foe into a dogfight, luring him to the ropes where he landed a jolting uppercut in the seventh round.
The two fighters swapped defiant words after Eubank Jr landed a decent left at the end of the eighth, while Saunders was briefly knocked off balance by another big left in the following round.
With the fight turning against him, Saunders stood firm in the ninth, edging the round with some classy combinations.
But Eubank Jr came roaring back in the closing rounds, unleashing hooks and uppercuts as he tried to force a dramatic stoppage.
A big uppercut staggered Saunders in the last round, but he dug deep, firing back with hurtful flurries of his own and both fighters shared a mutual respect after the final bell.
Saunders, who is hoping to land a shot at the WBO world title, said: “Listen, fair play to Eubank Jr, he???s better than what I thought, but he was a little too slow in the early rounds.
“I’ll gladly, when I’ll be world champion, give him first shot!”
Eubank Jr felt he had done enough to rescue a victory, but gave the winner some credit.
“I???ll be back in the gym tomorrow this isn???t the end,” he said. “I???m coming for the British (title) again, hopefully we can do a rematch. I felt like I won the fight, but congratulations to him.??
“He did what I thought he would do, boxed to the plan, early rounds came out strong. I felt like I overtook him, but the judges made their decision. I???ll be back.”
On a busy undercard, Frankie Gavin also claimed a split decision victory over Bradley Skeete in a cagey, technical welterweight contest.
Super-featherweight Liam Walsh extended his unbeaten record to 17 fights with a unanimous decision win over Gary Sykes, who bravely battled to the final bell after a first round knockdown.??