The victory saw him become the first man to complete a career 'Super Slam' of major junior and senior competition triumphs.
But Hanyu struggled to repeat his Olympic form, putting a hand down on his first jump before falling onto his back later in the free skate.
The 25-year-old admitted afterwards that he was not fully focused on the task ahead.
American Jason Brown, who trains with Hanyu under Brian Orser in Toronto, had the best international result of his career with second place.
Hanyu on top despite jumping errors
Hanyu stunned the skating world by reverting to his Olympic gold medal-winning routines just days before the competition.
That move looked to be inspired as he broke his own world record in the short program.
But the free skate was a different story.
Skating to 'Seimei' from the Onmyouji Original soundtrack by Shigeru Umebayashi, Hanyu opened up with a quad Lutz but a hand down on the ice cost him points.
He quickly recovered to pull off a quad Salchow and then followed up with a triple Axel and a triple flip with each of his clean landings met by loud cheers from the crowd inside the Mokdong Ice Rink.
Hanyu just about managed to land his first quadruple toe loop in combination with an Euler and triple Salchow, but he then fell on his second attempt at a quad toe.
Despite this, the two-time world champion still managed to set the highest free skate score of meet, racking up 187.60 points to clinch the win with an overall total of 299.42 points.
Hanyu is back on track after that shock defeat in the Japanese nationals but he still has plenty of work to do if he is going to close the gap to reigning two-time champion Nathan Chen at next month's World Championships in Montreal.
The Japanese told ISU.org, "I was disappointed (with my mistakes), but I will be able to prepare for the World Championships by analysing today’s mistakes. I would like to improve my skating more so I don't make the same mistakes in other competitions.
"There was a little bit of a problem with the ice before I skated. Because of that problem, I was unusually nervous but I think I tried my best."
The 'Super Slam' is complete
The Four Continents title also sees Hanyu become the first men's singles skater to complete the 'Super Slam'.
Since making his competitive debut in 2008, aged 13, he won the 2009-10 Junior Grand Prix Final followed by the 2010 world junior title.
As a senior, he won the first of four Grand Prix Finals in 2013-14, Olympic gold in 2014 and 2018, the 2014 and 2017 World Championships ,and now he has his first Four Continents crown.
He is almost certainly the greatest male singles figure skater of all time, although Nathan Chen might have something to say about that in the not-so-distant future.
Career best puts Brown on track for Worlds
USA's Jason Brown finished second with a near flawless free skate.
The 25-year-old was third after the short program and needed a big performance to stay in medal contention despite his disadvantage of not being a prolific quad jumper.
Brown opened strongly with a triple Axel-double toe loop combination.
He did make an attempt at a quadruple toe loop but opted to pop out and completed a double instead.
Another clean triple Axel and a typically strong artistic performance, to music from Schindler's List, earned him second place in the free skate with a new personal best of 180.11 points.
That gave him a new career-best total of 274.82 points and the silver medal in Seoul.
A "super excited" Brown told ISU.org, "I was really focused on going out there and skating my best performance that I could. I’m disappointed with my little blip. I was so close to skating completely clean so that’s a little bit of a bummer.
“I was rewarded for what I did so I’m really excited heading into the World Championships because I left a good 12 points on the table that I hope to get in Montreal." - Jason Brown talking to ISU.org
The 16-year-old was only fifth in the short program, but his jumping prowess gave him a chance of making the podium as he did at the Japanese nationals.
And so it proved with the youngster opening with a quadruple toe loop-double toe loop combination and going on to land another quad toe loop, a triple flip-triple toe loop combination and a triple Lutz.
His only blemish was a step on his final jumping element, the triple Axel, but he did managed to stay upright.
The result was a score of 179.00 points and third place overall with a career-best 270.61 points.
He said to ISU.org, "I never could have imagined getting a medal here and I’m still in shock.
"I’m happy with my performance. I was able to skate without thinking too much. The Axel error was a stamina issue but I enjoyed skating and making the audience happy."
Jin Boyang was second after the short program but struggled on his quadruple jumps today and ended up missing out on the podium.
The Chinese skater only scored 171.84 points to come home fourth with 267.67 points.
Home favourite Junhwan Cha posted a season's best of 175.06 points following a stellar routine on home ice.
The reigning national champion cleanly executed all his jumps including a quad toe loop, quad Salchow, triple Lutz-triple loop combination and a triple Axel.
Cha was sixth after the short program and ended up fifth overall with 265.43 points, hanging out with his Toronto rinkmate Hanyu afterwards.