After a cagey 120 minutes, the Lions of Teranga prevailed after spot-kicks, as Liverpool star Sadio Mane made amends for his miss from 12 yards after just seven minutes to score the decisive penalty to seal victory for his nation.
It was heartbreak for his Reds teammate Mohamed Salah, who did not even get to take a penalty in the end as it finished 4-2 and was consoled by Mane after the final whistle.
Meanwhile, Senegal players celebrated in style and none more so than Chelsea goalkeeper Edouard Mendy, who made a key penalty save in the shootout as well as several important stops on the road to the final.
The Blues glovesman, who was named the best goalkeeper of the tournament, was without a club and on the verge of retirement just six years ago as he searched for a new club in France.
But on Sunday he was left celebrating his third trophy in less than a year, having added another gong to his ever-growing collection to continue what has been a remarkable career turnaround.
In just ten months, Mendy has now won the Champions League, Super Cup and Africa Cup of Nations and also claimed individual accolades of the FIFA The Best Men's Goalkeeper and UEFA Men's Goalkeeper of the Year awards.
And it's no surprise the 29-year-old was absolutely ecstatic as he celebrated with his teammates after the final.
Meanwhile, it appeared Mane had a good night as he woke up with the trophy in his bed.
Senegal head coach Aliou Cisse dedicated the nation's first Africa Cup of Nations triumph to the country's people after the victory over the seven-time winners.
"I dedicate this victory to the Senegalese people," he said.
"For years, we have been chasing this cup. Today we will be able to put a star on our jersey.
"Winning the Africa Cup of Nations in Cameroon has a special meaning. Winning against the most successful team in Africa is another symbol."
Cisse paid particular tribute to his staff after seeing keeper Mendy save Mohamed Abdelmonem's penalty to allow Mane to redeem himself as he clinched a 4-2 success.
He said: "For almost seven years, we have been working. Good job, guys."