It was Japan's fourth win in the competition, which this year also included Canada and the United States, and dethroned Fiji who had won six of the last eight editions.
Japan's three tries at a capacity Chichibunomiya Rugby Stadium in Tokyo on Saturday all came from mauls, with Mamoru Harada, Ben Gunter and substitute Samisoni Tua going over, while Sam Greene added a conversion and penalty.
Fiji, ranked No.9 in world rugby to Japan's 12th spot, scored two tries through Virimi Vakatawa and captain Tevita Ikanivere, with Caleb Muntz adding a conversion and Isaiah Armstrong-Ravula a penalty.
But Japan's superior fitness allowed them to play a quick game that tired out the Fijians, who initially looked as if they would prove too physically powerful for the hosts.
Vakatawa's power saw him drive over the line in the 10th minute for the first try of the match despite four Japanese defenders trying to stop him. The 34-year-old former France international was making his second appearance for Fiji after switching his allegiance.
Harada had Japan's first try from a lineout maul in the 22nd minute when Fiji were down to 14 men after a yellow card for prop Mesake Doge, but the favourites went 12-10 ahead at the break after a short pass at the lineout caught out the Japanese defence and saw Ikanivere sprint away to score.
Japan dominated the second-half exchanges with Fiji tiring quickly and the hosts had several rolling mauls that Fiji managed to hold off but eventually broke through when Gunter forced his way over in the 57th minute.
Armstrong-Ravula's penalty for Fiji levelled matters at 15-15 with 15 minutes to go, but another maul allowed Tua to score the match-winning try in a major triumph for Japan.
