Williams bested Safina 6-0, 6-3 for her 10th major singles championship in what will be remembered as one of the most lop-sided finals in Australian Open history.
The win means the second-seeded Williams, who won the Australian Grand Slam event in 2003, 2005 and 2007, replaces Serbia's Jelena Jankovic as the world's No. 1 ranked player.
"She never even let me into the match," said the 22-year-old Safina. "She is a champion. She proved that."
After Williams held serve in the first game, Safina double-faulted the second game away and her play unraveled.
"I felt like I was in control from the third game," Williams said. "When she lost serve in her opening game after having a few chances to hold, I got a little more confident off that a lot."
Williams, 27, earned nearly $1.3 million for her 33rd career singles title and now has her sights set on the French Open.