Fury dominated throughout the rematch at the MGM Grand arena before Wilder's corner threw in the towel in the seventh round.
The victory comes 14 months after the Mancunian's controversial draw with Wilder - when he outboxed the WBC champion only for two knockdowns to deny him the famous green belt.
Fury vowed to take the fight to Wilder - and he did just that, flooring the champion twice and completely dominating the action before referee Kenny Bayless stepped in to save Wilder from more punishment.
Fury, dubbed the "Gypsy King", entered the arena held aloft on a throne by handlers, a royal robe around his shoulders and a crown on his head as the song Crazy by Patsy Cline played.
Wilder followed a few minutes later, his face hidden behind a glittery mask and a rapper in front of him.
Both fighters were guaranteed $5m for the bout but could make $40m or so if the fight performs well on pay-per-view.
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