Canelo (53-1-2) came out on top in a tense and tactical battle in Las Vegas, where the Mexican star successfully stepped up two weight divisions on Saturday.
Biding his time, Canelo finally got to Kovalev (34-4-1) in the penultimate round with a vicious left hand that left the unsuspecting Russian on the canvas at MGM Grand.
Seeking to become a world champion at a fourth different weight, Canelo comfortably came in at his heaviest, having previously topped out at 167.5 pounds for his super-middleweight bout with Rocky Fielding last December.
After his emphatic win over Fielding in New York, Canelo dropped back down to middleweight to beat Daniel Jacobs on points in a unification clash.
Canelo leapt up two division to face WBO champion and veteran Kovalev – nicknamed 'Krusher' – and he was often outworked by his opponent's jab under the bright Las Vegas lights.
As Kovalev used his height and length to keep his distance, Canelo patiently stalked the 36-year-old with power shots to the head and body when available.
There was not much to separate the pair as some of the crowd directed boos as Canelo, who tried to solve the puzzle of fighting two weight classes above what he is accustomed to.
That was until Canelo shocked Kovalev and the world with a devastating combination to pass his latest test with flying colours in Nevada.