The 20-year-old, who took Commonwealth Games silver in the 100m, powered through a headwind in 19.98 seconds to beat favourite Christophe Lemaitre into second.
Londoner Gemili, a former footballer, burst on to the athletics scene in time for the 2012 Olympics in his hometown, and has progressed well since taking up track full-time.
In rainy and windy conditions in Zurich, the popular youngster led from start to finish, building up an unassailable gap over Frenchman Lemaitre.
"I used to think the only way I'd be able to hear the national anthem was with the England football team," said Gemili, who was playing non-league football just three years ago. "It's a great feeling, it's the best feeling in the world.
"It was really cold and the track was really wet and I don't know why the race was on so late.
"I had the big man Christophe in the lane inside of me and I knew he’d be coming, so I tried to just run the bend as I usually do and hang on for dear life.
"I could hear the footsteps coming, and you could probably see the tension in my face, but then I crossed the line and saw a sub 20 seconds and I was gob-smacked.
"To become European champion was a big target for me this year and to achieve it is amazing."
It capped a fine day on the track for the British, with Martyn Rooney winning the 400m title earlier on ahead of countryman Matt Hudson-Smith. Teenager Hudson-Smith was fortunate to start the race after a false start was only penalised with a warning.
Winner Martyn Rooney of Britain and second placed compatriot Matthew Hudson-Smith (L)
Rooney's victory was Britain's first men's 400m gold since Iwan Thomas won in 1998, and also the Croydon runner's first major title. He won the race in a season's best time of 44.71s.
Gemili and Rooney's wins mean Britain’s men have won every individual flat sprint so far, with James DeSaolu victorious in the 100m.
“I’ve never won anything major in my life," said Rooney. "I’ve won the trials and stuff, but to win the European Championships, I’m ecstatic. It was great to have a 1-2 as well, that’s great for British Athletics, for me personally to have someone to race for the next couple of years – it’s amazing.
“Matt’s a fantastic kid. Call up rooms are good fun with him - I love having him about, he’s got a great coach, great family and great set up. It's brilliant we’ve got another young British talent coming through.”
Britain’s women fared well too, with Jodie Williams earning silver in the women’s 200m, won by the Netherlands’ Dafne Shippers, while Laura Weightman took bronze in the 1500m, Sifan Hassan bagging another gold for the Dutch when she won in 4:04.18.
Schippers' victory was her second at the championships, having won the 100m. Her time of 22.03s was the fastest so far this year. Myriam Soumare of France finished third behind Williams.
Former Olympic and world champion Christine Ohuruogu, 31, could not add another medal to her collection, coming a photo-finish fourth in the 400m despite a trademark strong finish. Cuban-born Libania Grenot won for Italy in 51.10 seconds.
World champion Bohdan Bondarenko won the men's high jump, clearing 2.35 metres at the second attempt to push fellow Ukrainian Andriy Protsenko (2.33) into second place. Bondarenko's great rival, Olympic champion Ivan Ukhov of Russia, was third on 2.30.
On a damp and chilly evening, Bondarenko was well short of the 2.42 he jumped earlier this year and Javier Sotomayor's long-standing world record of 2.45.
Olympic silver medallist and former world champion Anita Wlodarczyk of Poland retained the women's hammer title with a year's best effort of 78.76, less than one metre short of Betty Heidler's world record of 79.42.
Kariem Hussein brought the house down when he won the 400 hurdles in 48.96 seconds for hosts Switzerland.
Poland took gold and silver in the 800 with Adam Kszczot winning in one minute 44.15 ahead of Artur Kuciapski.
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- Athletics, Track & Field
- Christophe Lemaitre