Svindal, who is also in second place in the overall men's points totals, turned in a flawless run of 1 minute, 14.18 seconds on the famed Strief race course to nip Matthias Mayer of Austria, who took his first career podium, by 0.13 seconds.
It was also the first win at Kitzbuehel for the veteran Svindal.
"I constantly got reminded that before today I had never won in Kitzbuehel and it's nice to put that question to rest," he said.
Italian Christoff Innerhofer took third place followed by Kjetil Jansrud of Norway, Canada's Erik Guay and Ted Ligety of the United States, who was clocked at 1:15.31 and was in third place in the overall standings at the end of the day.
Ligety appeared to be on a solid competitive run on the top portion of the Strief, which is known for its technical turns and difficult flat lighting due to the predominance of shade. But he ran into trouble at the Hausberg jump.
"I felt like I skied really well in sections for sure and just got locked on my edge coming over Hausberg and ditched a lot of speed there and didn't attack it as hard as I should have," Ligety explained. "Some guys are really direct and ski it really hard and maybe it's sloppy looking but they make up a lot of time there where I was a little bit too neat."