The world number two, a five-time champion of the tournament who had claimed the last three titles in the California desert, had not lost in the competition since 2013.
However, Kyrgios was relentless as he sent down 14 aces, which included second serves close to 120mph, won 85% of points on his first serve, and faced no break points.
Djokovic was afforded no break-point opportunities in the second set and fended off two from Kyrgios in the 11th game to force a tie-break.
The Australian dominated, though, clocking one serve at 141mph, and closing it out with another huge serve that Djokovic could not return.
It was Kyrgios's second win over Djokovic in two weeks as he also emerged triumphant in straight sets over him at Acapulco's Mexican Open on March 2.