EVIAN, September 14, 2014 (AFP) - It was the first time Kim had played in a women's major and she held her nerve to hole a 15-foot birdie putt at the 18th to finish ahead of veteran Webb.
Webb, aiming to become the first player to win six different majors in her stellar career, was one ahead playing the 18th.
But she took three from the edge -- missing her 12-foot par effort - to be edged out by the tenacious teenager.
Even 19-year-old Kim looked stunned.
She had shot a final round 68 and the 11 under par total secured the 350,000-euro prize and the added bonus of a free pass onto next season's LPGA Tour.
Webb also shot 68 for second place on ten under with another two South Koreans, Jang Ha-Na (66) and Hur Mi Jung (68) tied for third on nine under. Yet another Korean Choi Na Yeon was fifth on eight under following a 67.
Kim started the final round one shot ahead of playing partner Webb and was two ahead of everyone by the turn and three in front with just six holes to play.
But Webb, a seven-time major winner, then launched a typically gutsy attack. She birdied the short 14th and the long 15th. Kim bogeyed 14 and dropped another shot at the 16th to suddenly find herself one behind with two to play.
At the 17th, she chunked her second shot but managed to salvage a par and then the 18th hole birdie sealed it.
"I felt really nervous today but I'm very happy with the win," said Kim through an interpreter. "The course is hilly -- just like in Korea."
Webb was shell-shocked.
"I don't know what hit me," was her immediate reaction. "There was probably a bit of adrenaline at the end and I hit the shot with the belly putter too strong and then missed the putt back."
Kim won as an amateur on both the Korean and Japanese Tours and she finished fourth in the Evian Masters -- the event before it became a major -- as an amateur in 2012.
Last year, she was the Rookie of the Year on the Korean Tour and has won three times this season.
She has already been hailed as the best South Korean since Pak Se Ri, who won two majors as a rookie in 1998.
At the start of the week, Kim said she was unsure as to whether she would go to the LPGA Tour qualifying school this year.
Now she doesn't have to bother.
"I'll certainly take it," she said of her exemption onto the 2015 circuit.
Michelle Wie, who had to pull out of the first round with a hand injury, stayed on for the rest of the tournament and was rewarded by becoming the inaugural winner of the Annika Major Award.
It is for the player who has won at least one major and has the best overall record.
Wie is the US Women's Open champion and was runner-up to Lexi Thompson in the Kraft Nabisco Championship.
Leading final round scores Sunday at the Evian Championship USLPGA golf tournament (par 71):
273 - Kim Hyo-Joo (KOR) 61 72 72 68
274 - Karrie Webb (AUS) 65 71 70 68
275 - Jang Ha-Na (KOR) 70 71 68 66, Hur Mi Jung (KOR) 66 69 72 68
276 - Choi Na Yeon (KOR) 70 72 67 67
277 - Suzann Pettersen (NOR) 67 69 74 67
278 - Paula Creamer (USA) 69 71 72 66
280 - Brittany Lincicome (USA) 67 65 77 71, Lydia Ko (NZL) 69 68 72 71
282 - Feng Shanshan (CHN) 70 70 73 69, Moriya Jutanugarn (THA) 69 68 75 70, Lexi Thompson (USA) 70 70 71 71, Park Inbee (KOR) 69 72 69 72, Mariajo Uribe (COL) 68 70 70 74, Anna Nordqvist (SWE) 71 67 70 74
283 - Lizette Salas (USA) 69 75 71 68, Oh Ji Young (KOR) 73 71 71 68 Minjee Lee (AUS) 72 67 73 71 Stacy Lewis (USA) 70 67 73 73
284 - Jodi Ewart Shadoff (GBR) 72 72 74 66, Jenny Shin (KOR) 71 76 69 68, Yan Jing (CHN) 71 75 69 69, Park Hee Young (KOR) 72 70 72 70
285 - Mina Harigae (USA) 69 71 75 70, Azahara Munoz (SPA) 70 72 72 71, Jane Park (USA) 74 72 67 72
286 - Karine Icher (FRA) 68 73 72 73, Kim In Kyung (KOR) 69 69 73 75