Al Boum Photo, trained by Willie Mullins and ridden by Paul Townend, has become the first back-to-back winner of the Gold Cup since the great Best Mate on an incredible day for the team at Cheltenham.
Sent off the 100-30 favourite, Al Boum Photo travelled well throughout for Townend and seized control jumping the last as Lostintranslation tried his best to challenge.
Santini also emerged from behind to stake his claim and the three of them battled it out up the hill, with Al Boum Photo hanging on at the line.
Santini took second, with Lostintranslation third and Monalee back in fourth.
Al Boum Photo follows in the hoofprints of Best Mate, who won the race three times between 2002 and 2004.
Townend said: "It's amazing. I tell you, I'd want some boot in the rear end if I was in front that early and got beat by Santini though.
"I thought I'd never feel anything like the feeling I had here last year, I think this is even better. It's all about this, it's all about this lad.
"Unreal, it's a credit to Willie. To come here with one run, the man's a genius."
Mullins said: "It's a fantastic, absolutely unbelievable day. That man there on the screen, Paul Townend, people said he was under pressure.
"Paul does his own thing, he probably rides better under a little bit of pressure, (it was) really, really good from him.
"(I'm) delighted for Paul, it's not easy to take over from someone like Ruby Walsh, but Paul's gone and stamped his authority this season in Ireland riding for our yard, so I'm really delighted for him."
Earlier, Monkfish stuck to his task in tremendous style to win a thrilling race for the Albert Bartlett Novices' Hurdle and give Willie Mullins a quickfire hat-trick at Cheltenham.
The 5-1 chance was always prominent and even a mistake three out could not stop the progressive six-year-old.
Four of the fancied horses were in with a shout coming with the last, but it all got a bit tight and Thyme Hill was squeezed for room.
Monkfish looked third best at one stage, but he battled on gamely for Paul Townend and put his head down to beat Latest Exhibition by a neck, with Fury Road a nose away in third.
Thyme Hill was a length and a quarter away in fourth after having to be switched.
A dramatic renewal of the JCB Triumph Hurdle saw Goshen crash out at the final flight with the race at his mercy - leaving Burning Victory to record an unlikely success at Cheltenham.
Ridden by Jamie Moore for his father, Gary, Goshen looked set to run out a brilliant winner when he approached the last well clear of the opposition, after surging ahead from two out.
But there was a miscommunication and he appeared to just clip the top of the last, causing him to jink one way and giving Moore no chance of staying on board.
Allmankind, who had given the strong-travelling Goshen a lead and had most of the field under pressure, tried to rally, but Burning Victory, who had been ridden patiently, emerged to have her say.
With Goshen gone in dramatic fashion, Paul Townend took his opportunity and the Willie Mullins-trained Burning Victory (12-1) stormed up the hill to score by two and three-quarter lengths.
Aspire Tower was second, with Allmankind three-quarters of a length away in third place.
Saint Roi landed a gamble with a convincing victory in the Randox Health County Handicap Hurdle at Cheltenham.
Saint Roi may have been lightly-raced, but money talked and the JP McManus-owned five-year-old delivered in style.
Coming to the last, Embittered held every chance, as did a few others, but the Barry Geraghty-ridden Saint Roi was going best of all and the 11-2 favourite pulled away to win decisively by four and a half lengths.
Willie Mullins also saddled the runner-up, Aramon, with Gordon Elliott's Embittered a head away third and another of the Mullins' team, Buildmeupbuttercup, another head back in fourth.