The Selecao, fuelled by a deafening atmosphere inside the Maracana, brought la Roja to their knees with an outstanding display to win the tournament for a fourth time
The tournament hosts were in supreme form inside a raucous Maracana, ripping the reigning world and European champions to shreds to end their 29-match unbeaten run, and claim the trophy for the fourth time, alongside their triumphs of 2009, 2005 and 1997.
Fred needed only 90 seconds to open the scoring, before a thumping second from Neymar moments before the break rounded off an excellent first half for Brazil.
The onslaught continued two minutes after the restart when Fred put another past a shell-shocked Spain, who showed their ineptitude at both ends when Sergio Ramos lashed a penalty wide.
Gerard Pique's 68th minute red card ended any fleeting hopes of a comeback from la Roja, as Brazil's win sparked wild celebrations in the stands and saw Spain lose by three goals in a competitive game for the first time since 1985.
The fans had the Maracana rocking long before kick-off, and barely two minutes in, the home side nearly blew the roof off the famous stadium when they took the lead.
Oscar delivered a ball into the box which Fred, Iker Casillas, Alvaro Arbeloa and Pique all challenged. A goalmouth scramble ensued and, despite laying on the turf, the Fluminense man reacted quickest to poke home.
Fred very nearly set Oscar up for the second within minutes when he flicked across the box from Neymar’s cross, but Chelsea’s young playmaker drilled agonisingly wide.
Paulinho then made Casillas work hard to keep the deficit at one with a cheeky lob after robbing Andres Iniesta, with the Spain keeper backpedalling to get a hand to the attempt.
Vicente Del Bosque’s side were simply struggling to cope with the tenacity and energy in Brazil’s play, which was matched every step of the way by the fervour raining down from the stands.
And Arbeloa nearly committed a fatal mistake when he flattened Neymar on the halfway line, but with the fans baying for blood, only a yellow card was issued to the defender.
Spain finally showed signs of life when Iniesta’s rasping drive forced Julio Cesar to push around the post, but it was an aberration amid Brazil’s dominance, and Casillas had to stand tall again to stop Fred from point blank range.
However, it was then the hosts' turn to live on the edge when an outrageous goal-line clearance from David Luiz denied Pedro a sure-fire goal after Mata’s pass put him one-on-one with Cesar.
But with half-time approaching, Brazil would get their deserved second. Oscar drew the attention of the defence on the edge of the box and deftly slipped in Neymar, who unleashed an unstoppable shot into the back of the net.
And two minutes after the interval, the hosts struck again. Hulk’s fantastic diagonal ball was cleverly dummied by Neymar, leaving Fred to finish coolly into the bottom corner.
Spain were handed a glimmer of hope with a penalty after Marcelo clumsily challenged substitute Jesus Navas, but Ramos extinguished that optimism almost instantly with a wild spot-kick that flew wide.
And they were finished for good when Pique stuck out a leg in vain to bring down the onrushing Neymar, earning the Barcelona defender a straight red card as the last man.
It was party time inside the Maracana, with the irrepressible Neymar driving past defenders with ease, and substitute Jo coming close to a fourth with a powerful strike that was saved by Casillas.
Spain had a few chances to restore a little pride, but Pedro was denied excellently from close range by Cesar, who did equally well to push away a curling Villa effort with only minutes remaining.
But it just was not la Roja's night, with the final whistle signalling what had been an inevitability for some time as the Brazil celebrations kicked off in earnest.
The question now is whether the Selecao can ride this wave of momentum all the way onto the biggest stage of them all at World Cup 2014.