Skating in the seventh of 18 heats, the 25-year-old drew little attention as she started her two-and-half laps but the sparse Adler Arena crowd drew gasps after she clocked a time of one minute, 14.02 seconds - just outside the Olympic record.
Women's 3,000 metre champion Ireen Wust of Netherlands finished second, 0.67 seconds back of Zhang, with Dutch skater Margot Boer the only other competitor to get within a second of the Chinese as she claimed bronze.
Zhang's best finish over the distance in the current World Cup campaign had been sixth and she said she hadn't been thinking about winning.
"I'm so glad to have won the gold medal for me its been a very good result, a great achievement," she told reporters, laughing and grinning with delight upon each question.
"China has been waiting for this gold medal for 12 years and I can't believe I have reached this goal. I thought about medals but not a gold."
She had shown promise in the 500 metres on Tuesday by clocking the third fastest time in the first race but just missed out on a medal in fourth after she struggled in the second skate.
Stamina was no such problem on Thursday, though.
Buoyed by hearing that Li Jianrou had won gold earlier in the women's 500 metres short track, Zhang flew from the start and maintained her pace as she jumped to the top of the leaderboard by a vast three seconds after her skate.
"That was a good and positive start for me today," Zhang, a former short track skater, said of Li's success.
Heilongjiang-born Zhang then watched from inside the oval with her coach as she held her position as the list of medal favourites and big names struggled to get anywhere near her time.
Germany's Monique Angermueller followed South Korean Lee Bo-ra in falling in an incident filled session as Zhang maintained a lead of over a second with only eight skaters left to go.
World Cup leader Heather Richardson went next but she was always outside the split times of Zhang, while world record holder Brittany Bowe faired no better as the highly fancied American duo finished down in seventh and eighth.
Olympic 500m champion Lee Sang-hwa went in the final heat and she skated under Zhang's time over the opening lap but the South Korean tired in the latter stages and could only finish 12th.
That allowed Zhang, who had been waiting patiently for almost an hour, to celebrate and she raced around the Adler Arena draped in the China flag
"I was very nervous as I was waiting and I don't think anybody could understand how I was feeling," she said.
"I think it will only be tomorrow that I will realise I am a champion and I won the gold," she said.
Wust went in the penultimate heat with Bowe but the shorter distance is not her preferred event and she was delighted to get silver to go with her 3,000m gold.
"You have to admire what Zhang did," Wust told reporters.
"I saw her time and I was like 'oooh, its going to be a tough one'."
Wust and Boer's medals moved the Dutch speed skating team on to 12 for Sochi, surpassing their Olympic record of 11 set at the 1998 Nagano Games, with six golds still up for grabs.
They also closed in on the record of 13 set by East Germany at the 1988 Calgary Games.
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