The former England striker met a Steven Fletcher header with a left-footed strike that flew over Tim Krul to move the Black Cats three points clear of the relegation zone
Dick Advocaat's first home fixture as boss at the Stadium of Light saw an encouraging, determined display that was lit up by Defoe's wonderstrike shortly before half-time.
The former Tottenham forward's brilliant goal from the edge of the area was enough for Sunderland to complete the double over their arch-rivals for the second season running, and also moved them three points clear of the Premier League relegation zone with seven games left to play.
Defoe was close to tears after sending the Sunderland faithful into raptures, and the hosts' lead was never really threatened by a lacklustre Newcastle side.
Newcastle, who restored Jonas Gutierrez to the starting XI for the first time since August 2013 after his battle with cancer, were subdued throughout and have now lost four games in a row.
Sunderland had by the far the better of the opening stages but did not create anything of note until the 21st minute when Connor Wickham's header was deflected onto the post and wide by Moussa Sissoko.
Newcastle seemed content to play on the counter-attack and were finally punished for their lack of ambition in remarkable fashion by Defoe on the stroke of half-time.
Steven Fletcher beat Mike Williamson to a header following a long free-kick forward and Defoe unleashed a thunderous left-footed volley into the top-right corner from 18 yards, leaving Tim Krul with no chance.
Defoe was emotional as the sides went into the tunnel for the interval, but Sunderland emerged for the second half re-focused and dangerous as they searched for a second goal.
Newcastle did gradually get more of a foothold in the game but were unable to craft anything to trouble the Sunderland defence.
Instead it was Advocaat's man who went closest to scoring again, Sebastian Larsson bending a free-kick narrowly wide of the left-hand post.
Remy Cabella stung the palms of Costel Pantilimon and Ayoze Perez curled over the crossbar from the edge of the area as Newcastle pressed for an undeserved leveller late on.
Perez then wasted a great chance to level in the 88th minute as he volleyed over from a corner, but Sunderland were able to see out the remainder in relative comfort to give their supporters hope that Advocaat is the man to steer the club to safety.