Melbourne: Second seed Wozniacki, the former World No.1, prevailed 7-6 (2), 3-6, 6-4 in two hours 49 minutes over top seed Halep, who was bidding to win her first major title.
"I've dreamed of this moment for so many years. Today is a dream come true. I'm shaking right now. I'm going to cry," Wozniacki said after the win, according to the tournament's Twitter handle.
It was a historic win for the second-ranked Wozniacki, who became the only player from Denmark to win a singles title at one of tennis' four major tournaments, reports Efe.
The win catapults the 27-year-old Wozniacki, who had been No. 1 for two stints between October 2010 and January 2012, back into the top spot in the WTA rankings.
The third time was the charm for a player who had lost twice in the US Open championship match, most recently to American great Serena Williams in 2014.
Halep struggled with muscular issues in her left leg and at one point called for a medical time-out during the match, as did Wozniacki for a left-knee problem.
The 26-year-old Halep, who finished runner-up at the French Open in 2014 and 2017, was more weighed down by her physical issues though, no doubt feeling the effects of a taxing tournament in which she had to save five match points in a pair of marathon victories over American Lauren Davis in the third round and Germany's Angelique Kerber in the semi-finals.
Wozniacki, who came into this tournament fresh off capturing the 2017 WTA Finals, stormed out to a 3-0 lead in the first set before the Romanian player got her teeth into the match.
Wozniacki had her serve broken in the first set but managed to win the tiebreak, sealing the first set in 50 minutes.
Halep called for the tournament doctor, who came on court after she won the fifth game of the second set to take a 3-2 advantage.
She then continued to fight through apparent leg cramps to win that set in 48 minutes.
The match was halted for 10 minutes before the third set due to the WTA's extreme-heat rule, and Halep's physical problems were even more apparent when she returned.
The Romanian, who often makes audible comments to her team during matches, was heard saying, "I cannot, I cannot."
The third set was a veritable roller-coaster ride featuring seven breaks of serve, with Wozniacki taking a 3-1 advantage before Halep rallied back to 4-4.
Wozniacki, however, won the next two games to finally taste victory in a major title in her 43rd appearance in a Grand Slam event.