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On a glorious day of sunshine at Riviera Country Club, the 29-year-old held off a fast start by veteran crowd favourite Fred Couples and a mid-round charge by Vijay Singh with a two-under-par 69.
Baddeley, whose world ranking has plummeted to 224th while revamping his swing over the last two years, clinched his third title on the US circuit with a 12-under total of 272.
He coolly parred the last, after chipping to five feet from just off the right edge of the green, to seal a long-awaited victory, and his first since the 2007 Phoenix Open.
With his wife and two children watching him from behind the green, Baddeley raised both arms skywards before pumping his right fist in celebration.
"It's definitely been a couple of long years, but it was worth every bit," the Australian told reporters after earning the winner's cheque for $1.17 million and invitations to this year's Masters and PGA Championship.
"The last couple years ... made it easier today just because of having to battle and having to grow into so much ... the character that was just built in me, I guess."
Fijian Singh fired a matching 69 to finish alone in second while 51-year-old Couples, who briefly led by a shot early in the final round, had to settle for a share of seventh at seven under after closing with a 73.
"I'm disappointed but Aaron played very, very well," said the silver-haired Couples, a double champion at Riviera who was seeking his first PGA Tour win since the 2003 Houston Open.
"If I could have just hit a couple more shots and finished even in third place, that would have been phenomenal. I'm pretty happy with the way I played, but I was trying to win."
South Korea-born American Kevin Na, seeking his first PGA Tour win to honour his father, who was diagnosed with leukemia last year, carded a 71 to secure third place at nine-under.
THUNDEROUS OVATION
Baddeley held a one-shot lead going into the final round but it was Couples who made the first significant move of the day after receiving a thunderous ovation on the first tee.
Bidding to become the third-oldest winner on the PGA Tour, the American who has battled back pain for the last 20 years began with three consecutive birdies, including a chip-in from 29 feet at the tricky par-four second.
That left him one ahead of Baddeley who had birdied the par-five first before parring the next two holes.
Couples, however, fell back with a bogey at the sixth and a double-bogey at the seventh, where he drove into thick grass in a ravine, hit out sideways into a fairway bunker and failed to reach the green in three.
Baddeley capitalised on Couples's misfortune at the crucial seventh hole by sinking a 22-foot birdie putt from the fringe of the green to forge two strokes clear.
"That was definitely a huge turnaround to go from even (with Couples) to two up, depending on what Vijay did," Baddeley said. "That was big."
Out in two-under 33, the Australian stretched his lead to three when he knocked in a six-footer to birdie the driveable par-four 10th.
Although Baddeley wobbled with a double-bogey on 12 after hitting trees with his drive and second shot before overshooting the green with his third, he made some amends at the 13th.
From just behind the green in two, he rolled in a left-to-right breaking birdie putt from 25 feet to regain a three-stroke cushion at 12-under.
Baddeley then played bogey-free golf over the final six holes to hold off Singh, who recorded six birdies in the final round in pursuit of a first PGA Tour win since the 2008 Deutsche Bank Championship.
Last year's winner Steve Stricker closed with a 72 to finish at two-under, one shot better than twice champion Phil Mickelson who ended a disappointing week with a 68.
Leading final-round scores here on Sunday in the 6.5 million-dollar PGA Northern Trust Open on the par-71 Riviera Country Club course (USA unless noted):
272 - Aaron Baddeley (AUS) 67-69-67-69
274 - Vijay Singh (FIJ) 68-70-67-69
275 - Kevin Na 71-66-67-71
276 - Robert Allenby (AUS) 67-70-71-68, Jimmy Walker 68-71-69-68, Ryan Moore 69-68-70-69
277 - KJ Choi (KOR) 70-69-70-68, Fred Couples 68-66-70-73
278 - JJ Henry 69-74-69-66, David Duval 71-71-69-67, Justin Rose (GBR) 69-69-70-70
279 - Bill Haas 67-74-71-67, Paul Casey (GBR) 71-67-73-68, Jhonattan Vegas (VEN) 71-70-72-66, Ben Curtis 71-70-71-67, Kevin Stadler 70-71-69-69, Retief Goosen (RSA) 69-71-70-69, JB Holmes 67-69-72-71, Stuart Appleby (AUS) 69-72-68-70, Spencer Levin 67-69-72-71
...
280 - Geoff Ogilvy (AUS) 69-71-71-69, John Senden (AUS) 67-69-71-73
281 - Martin Laird (GBR) 67-73-69-72
282 - Brendon de Jonge (ZIM) 72-72-69-69, Trevor Immelman (RSA) 70-67-72-73
283 - Jarrod Lyle (AUS) 70-72-71-70, Phil Mickelson 71-70-74-68
286 - Padraig Harrington (IRL) 68-71-75-72, Carl Pettersson (SWE) 67-78-70-71, Andres Romero (ARG) 72-73-72-69
287 - Louis Oosthuizen (RSA) 71-70-72-74, Robert Karlsson (SWE) 71-70-72-74, Yuta Ikeda (JPN) 71-73-74-69
289 - Arjun Atwal (IND) 71-74-72-72
290 - Matt Jones (AUS) 71-74-72-73
292 - Michael Sim (AUS) 70-71-77-74
294 - Brian Davis (GBR) 68-76-78-72
