The 27-year-old was the last rider to go, and she broke her third Olympic record of London 2012 by scoring 90.089 per cent.
She eclipsed Dutch rider Adelinde Cornelissen and Parzival's score of 88.196, while Britain's Laura Bechtolsheimer and Mistral Hojris won bronze.
Dujardin, who had not even ridden a competitive grand prix test 20 months ago, added Individual gold to the Team gold she won earlier this week with Bechtolsheimer and Carl Hester.
Dujardin's routine to music was crammed with patriotic British tunes, such as Land of Hope and Glory and I Vow to Thee, My Country, and also included the chimes of Big Ben.
'That was unbelievable,' said Dujardin following the Victory Ceremony.
Not many people are going to have the chance that I've had to get to the Olympics in a year and a bit of competing in grand prix. I wanted to go out there and enjoy it.Charlotte Dujardin
'It is always something I've known the horse could achieve, but I didn't really know how I was going to find the atmosphere and the expectation.
'But when I got that phone call (last month) to say I had made the team for London, I was so determined.
'Not many people are going to have the chance that I've had to get to the Olympics in a year and a bit of competing in grand prix. I wanted to go out there and enjoy it.
'All I could do was to do my best. Valegro was feeling tired, but he got in there and he gave his all.'