Bodemeister held on for second after leading most of the race and Dullahan was up for third. Went the Day Well finished fourth.
Winning jockey Mario Gutierrez, 25, was riding in the Kentucky Derby for the first time after guiding I'll Have Another to victories in the top two California Derby prep races, including the Grade I Santa Anita Derby. Until recently, the native of Mexico was riding on a minor Canadian circuit.
"I don't know what to say," Gutierrez said with tears in his eyes as he brought I'll Have Another back to the Churchill Downs winner's circle. "He's an amazing horse. I kept telling everyone. The first time I saw him, I knew he was the one."
Pace dictated the race as Bodemeister, winner of the Arkansas Derby, went out to lead speedball Trinniberg through the first turn and down the backstretch. As the field turned for home, Trinniberg was done and Bodemeister quickly jumped out to a big lead.
Gutierrez, meanwhile, got an excellent start from the No. 19 gate -- which had never before produced a Derby winner -- and had I'll Have Another in a perfect position just off the rail and six behind the leader.
As he straightened out into the stretch, I'll Have Another hit full stride with nothing in his way and gradually wore down Bodemeister for the win. Dullahan, winner of the Blue Grass in his last start, rallied to take third.
Hansen, winner of last year's Breeders' Cup Juvenile, was close to the lead all the way and had every chance at mid-stretch but couldn't carry his speed. The Derby favorite, Union Rags, was pinched back at the start and could never reach contention.
The 1 1/4 mile over a fast track went in 2:01.83.
I'll Have Another paid $32.60, $13.80 and $9. Bodemeister returned $6.20 and $5.60. Dullahan paid $7.20 to show.
Winning trainer Doug O'Neill, with his son Daniel in the winner's circle, said, "Maryland, here we come!" The Preakness Stakes at Pimlico in Baltimore is the second jewel of the Triple Crown, followed by the Belmont Stakes three weeks later in New York.
Bodemeister's trainer, Bob Baffert, said he is "usually upset when I finish second. But he showed what a brilliant horse he is."
"I'm just really proud of the way he ran. He just came up a little tired after those fractions," he said.
Winning owner J. Paul Radam brought hundreds of his employees into the winner's circle after the Santa Anita Derby. Saturday he had a smaller crowd but seemed even happier as he hoisted the Derby trophy over his head.
"I was just kind of numb throughout the race and I blinked my eyes and it was over," he said.
I'll Have Another, a Kentucky-bred colt by Flower Alley, finished a well-beaten sixth in his final start of 2011 in the Hopeful at Saratoga. He has not lost since, winning the Group II Robert B. Lewis before the Santa Anita Derby.