Shiffrin led Gisin by just two-hundredths of a second after the first run, but it was Switzerland's Olympic combined gold medallist from PyeongChang 2018 who skied the second run the better and claimed an overdue triumph.
Austria's Katharina Liensberger produced a storming second run to take second (+0.11s), her best World Cup result after five third place finishes, ahead of double Olympic champion Shiffrin who was 0.57s off the pace.
It means Shiffrin has failed to win a World Cup slalom in a calendar year for the first time since her maiden triumph in 2012.
But the day belonged to Gisin who became the first Swiss woman to win a World Cup slalom since Marlies Oester at Berchtesgaden in January 2002.
She told FIS afterwards, "It's just amazing. My first victory exactly eight years after my first race in World Cup in exactly the same place. I can't even speak anymore. I'm so happy.
Gisin also credited her Swiss team-mates adding, "We're just pushing each other for so many years. It's a perfect day. I had a great first run, I had my coach setting the second run which, for sure, helped."
"It's crazy. I broke the incredible run of two giants." - Michelle Gisin on ending Shiffrin and Vlhova's dominance of World Cup slaloms
Vlhova had won each of the previous five slalom races, but finished just out of the podium spots in fourth place having been sixth after the first run.
The Slovak star had been frustrated on Monday when the giant slalom in Semmering was cancelled after she had clocked the quickest time on the first run.
Vlhova leads the World Cup slalom standings with 250 points, 25 points ahead of Gisin with Liensberger another 25 back and Shiffrin fourth on 185.
Her overall series lead is down to 88 points over Gisin with Shiffrin a further 92 points adrift in third.
The next World Cup race for the women is the Zagreb slalom on Sunday 3 January.