The previous best of 2:03:59 was by Haile Gebrselassie in Berlin 2008. But because Monday's race had a strong tailwind on a downhill course, Mutai's run does not qualify as the fastest time ever.
But Mutai was almost three minutes better than the course record set just last year by Robert Kiprono Cheruiyot.
Fellow Kenyan Caroline Kilel won the women's race, outsprinting American Desiree Davila to win by two seconds, in 2:22:36. Davila led as late as the final stretch on Boylston Street and ran the fastest time ever for a U.S. woman, surpassing the 2:22:43 by Joan Benoit in 1983.
No American - man or woman - has won Boston since Lisa Larsen-Weidenbach in 1985.
Kilel and Mutai each earn $150,00 for the win, and Mutai gets $50,000 for the world best and another $25,000 for the course record.
Mutai and Moses Mosop ran side-by-side for the final miles before Mutai pulled ahead for good on Boylston Street and winning by four seconds. The 19th Kenyan winner in the past 21 years, Mutai raised his arms in the air and grinned.
Masazumi Soejima and Wakako Tsuchida gave Japan a sweep of the men's and women's wheelchair divisions. It was the fifth straight win for Tsuchida and the second overall for Soejima.