Davydenko, who was seeded No. 6, scored a 7-6 (7-3), 6-3 victory over the Spaniard and collected $616,500.
"I think a little bit was luck, but mostly I was playing very well today," Davydenko said.
The win was Davydenko's 18th on the tour. He has a 3-4 career record against Nadal.
Davydenko also won events in Germany, Croatia and Malaysia this year.
"I don't like to lose, but I had my chances," said Nadal, a former world No. 1 with 36 ATP wins. "He beat me. He played ... very good match. Just congratulate him, because he deserved the victory."
Boston schools pull out free condoms over wrapping complaints
Ray Liotta sues skin care company over use of likeness