The Volunteers remained unbeaten in five games this season, falling behind by a point midway through the second half before pulling away down the stretch. Tennessee defeated Belmont, Missouri State and Virginia Commonwealth to reach the title game, which was played at Madison Square Garden.
Cameron Tatum added 17 points, Tobias Harris had 15 and Brian Williams 12 for the Volunteers.
Mouphtaou Yarou led Villanova (5-1) with 15 points and five rebounds.
Villanova had won its last 17 games in November dating to 2007. The teams met for the first time in 39 years.