The tournament was shortened after Friday's round was suspended due to thunderstorms and more rain hampered Saturday's action. Wet course conditions and not enough daylight for 36 holes of play on Sunday were also brought into consideration.
Davies entered the final round trailing Karrie Webb by one stroke, but Webb could only manage a final-round 70, to end in a tie for second with Rebecca Stevenson at 12-under-par 204.
Davies, who earns her 43rd international title, got off to a quick start Sunday. She carded back-to-back birdies at two and three before birdieing the sixth hole for the third straight round. She later birdied the par-5 ninth to make the turn at minus-13.
On the back side, Davies played consistent golf. She parred the first five holes before a birdie at No. 15 moved her to 14-under. Davies gave that shot back with a three-putt bogey at the 17th but held on for the win with a clutch par putt at the last.
'We've been taking a hammering recently,' said Davies, referring to the fact her native country of England had lost to the Australians in cricket and soccer in recent weeks. 'The Ashes were bad enough and the (soccer) was even worse, so it's nice to restore national pride again. I'm feeling confident with my game again and to beat Karrie in Australia, it doesn't get much better than that.'
Webb, a four-time ANZ Masters winner, matched Davies' front-nine 33, but she reached her total in different fashion. The Australian birdied the first and third, but she had bogeyed the second.
Webb ended her front-nine with birdies on three of the last four holes starting at the sixth to maintain a one-shot lead.
Around the turn, Webb bogeyed the 11th to drop into a share of the lead at minus-13. With a chance to force a playoff or win outright on 18, Webb bogeyed the hole, after being forced to layup due to a poor tee shot. She was unable to convert a 20-footer to save par that would have forced a playoff.
Stevenson tried to rally and create a playoff as well, but fell just short. She birdied the third and fifth, but faltered with a bogey at the eighth. Stevenson recovered that stroke with another birdie at the par-5 ninth.
She only managed two birdies on the back-nine, at Nos. 13 and 18, to finish one shot behind Davies.
Lorena Ochoa came in fourth place at 11-under-par 205. Denmark's Iben Tinning and Australia's Rachel Teske were one shot further back at minus-10.