The 24-year-old took full advantage of a tight and tricky course set by her own coaches to hand Austria a first Alpine skiing gold of the Games with a winning time of one minute 20.14 seconds.
Slovenia's Tina Maze, a giant slalom silver medallist at last year's World Championships, then produced a stunning run to cross the line 0.49 seconds slower than Fischbacher and snatch second place from Vonn who had to settle for bronze.
The Slovenian, her country's first Olympic medallist in Alpine Skiing since the 1994 Lillehammer Games, thrust her arms in the air and whooped in delight.
"I like a tight course and I like a difficult race," said Fischbacher, a super-G bronze medallist at the 2009 World Championships and a distant cousin of retired double Olympic champion Hermann Maier.
"We had not been doing so well in the speed events but we knew we could have a good result if we got everything right and I believed in my chances. This is a dream come true."
Maze's delight was evident as she stepped up on to the podium to take her bouquet of flowers.
"It's almost like I won gold. It's a great feeling," she said.
Vonn, who has already won the super-G World Cup title and had hoped to become the first US Alpine skier in 58 years to win two golds at a single Games, had dominated the downhill on Wednesday and was the clear favourite.
She blasted through the tricky top part where others had run wide or fallen but then blew her chances of gold on the easier stretch to the finish.
Fischbacher, starting two places after the American, was only 0.04 quicker at the first intermediate but the gap ballooned to 0.74 at the finish.
"I knew everyone was having trouble at the top and I really attacked," said Vonn. "Once I got past the difficult section, I kind of backed off the gas. I think that's where I lost the race."
Despite that, the American said she was happy with her second medal of the Games.
"I came here just hoping to get a medal and I got one gold. This is just the icing on the cake," she said. "I can't be too disappointed. Any medal at the Games is a success."
Five of the first 15 starters, including Canadian Emily Brydon, failed to reach the finish in the tricky conditions.
Julia Mancuso, hoping to add to her haul of two silvers, was first out of the start hut and the American remained top until number 12, Germany's super combined champion Maria Riesch, beat her by 0.04.
The pair ended up eighth and ninth.
"It's tough to go first, it's really hard to tell how the course is going to run," said Mancuso. "You just have to be on your toes."
Britain's Chemmy Alcott finished 20th, 3.32 seconds behind Fischbacher.
"The hill is so tough. It was definitely challenging and I love a challenge. I didn't really go for it enough.
"I made a judgement error and lost a ridiculous amount of speed."
Place of birth: Schwarzach, Austria
Residence: Eben Im Pongau, Austria
Previous Olympic results: 13th, 2006 Winter Olympics, super-G
Bronze medallist, 2009 World Championships, super-G Runner-up, 2008/09 World Cup, downhill
Fischbacher first started the sport after being given her first pair of skis for Christmas in 1989. She made her debut for Austria in 2004.
The 24-year-old is currently third in this season's World Cup super-G rankings and 11th overall.
She enjoys cycling, playing volleyball and motorcycles.