Kerr, who came from four strokes back to beat Stanford in May in the Franklin American Mortgage Championship in Tennessee, finished with a 12-under 276 total on the London Hunt and Country Club course. She earned $255,000 for her eighth career win.
Kerr, coming off a second-place tie last week in the Women's British Open, opened with rounds of 67, 70 and 74 to begin the day at 5 under. She flew up the leaderboard with six birdies in a nine-hole span, including four in a row on Nos. 7-10.
She made a 5-foot birdie putt on the par-5 16th -- with the ball spinning around twice before dropping in -- to reach 12 under and cut Stanford's lead to one, but missed a chance to reach 13 under when her 12-foot putt on 18 slid by the right edge.
The 27-year-old star rebounded from a disappointing finish in the Women's British Open. At Royal Lytham, she was a stroke back with three holes to play, but bogeyed 16 and finished with a double bogey to end up three strokes behind Sherri Steinhauer.
Stanford missed another great chance for her second LPGA Tour victory. The former TCU star won the 2003 Shoprite Classic in New Jersey and nearly followed it with a major victory, losing a playoff to Hilary Lunke in the U.S. Women's Open.
She also had a strong finish in Canada last year, tying for third at Glen Arbour in Halifax, Nova Scotia, two strokes behind Meena Lee.
Stanford's lead dropped to two with a two-stroke swing on the opening hole. After her approach shot plugged in the face of a greenside bunker, she blasted out to 15 feet and watched in disgust as her par putt lipped out. Meena Lee made a 12-footer for birdie after Stanford's miss to reach 10 under.
While Stanford and Lee matched each other on the next seven holes, Kerr was making her big move three groups ahead. Stanford got back to 13 under with a 12-foot birdie putt from the front edge on the par-ninth, but missed a 5-foot birdie putt on the par-5 10th. She also missed a 6-foot birdie putt on No. 3.
Canadian star Lorie Kane, paired with Kerr, shot a 75 to tie for 16th at 2 under.
Kerr's victory was the fifth by an American in 21 events this year and the third in five tournaments. ... The Royal Canadian Golf Association estimated the crowd at 16,500 for a four-day total of 61,000, the most since the governing body took over the national championship in 2001 after the du Maurier Classic folded. ... Tournament-saving title sponsor CN presented a $250,000 check to the Children's Hospital of Western Ontario at London Health Sciences Centre. The railway is in the first year of a three-year deal with the RCGA. ... Jocelyne Bourassa is the only Canadian to win an LPGA Tour event in Canada. She won the 1973 La Canadienne.