James, 19, coasted to victory in a time of 43.94 seconds, half a second ahead of the Dominican Republic's Luguelin Santos and Lalonde Gordon of Trinidad and Tobago who took silver and bronze.
The gold medal was the latest in a glut of titles for the youngster nicknamed "The Jaguar".
He followed up the 2009 world youth title with the world junior title in 2010 and last year in Daegu became world champion in only his fourth professional appearance.
"It means a lot. I am so excited," James said.
The race was notable for the absence of Americans who failed to make the final for the first ever time.
The U.S. have won the last seven Olympic titles and swept the podium three times in 2008, 2004 and 1988.
In London, though, the signs were ominous from the start when defending champion LaShawn Merritt pulled up with a hamstring injury just moments into his heat. Youngsters Bryshon Nellum and Tony McQuay could only make the semi-finals.
That left the stage free for James who looked in complete control of the one-lap race from the gun, gliding past his rivals before building his lead coming into the final straight.
World junior champion Santos, the third fastest man this year, was billed as James's main rival due to the absence of Merritt but he never looked like seriously threatening.
Belgian twins Kevin and Jonathan Borlee finished fifth and sixth respectively.
(For more sports news and updates, follow Ahram Online Sports on Twitter at @AO Sports and on Facebook at AhramOnlineSports)