The top-seeded Davenport, ranked second in the world, had won the past two Bank of the West titles, both against Williams in the final. This time, it was Williams who emerged the winner.
"I was going for it," said Williams, who had a 122 mph ace in the match.
Davenport said Williams played better than at Wimbledon.
"I don't think I played that bad today," she said. "Sometimes it's a situation where the other person plays so well, there's nothing you can do."
Williams, seeded second and ranked third, now has an unbeaten streak of 11 matches, dating back to her loss to Arantxa Sanchez-Vacario in the quarterfinals the French Open.
"This is definitely one of the most confident times for me," she said.
Williams easily took the first set under sunny skies at Stanford University. With serves regularly exceeding 110 mph, Williams was composed throughout the one-hour, nineteen-minute match. She described herself later as "precise and deliberate."
Davenport, who won the Australian Open this year, appeared slow and unfocused in the first set. Williams broke her serve to go up 3-1 with a backhand that Davenport didn't even attempt to return.
In the second set, Davenport mounted a comeback, this time breaking Williams to go up 3-1. But Williams broke Davenport's serve in the following game to narrow the margin.
With the second set tied at 3-all, the crowd took Davenport's side, cheering loudly when a powerful cross-court forehand won her the next game.
Williams broke Davenport to go up 5-4, then hit the 122-mph ace in the final game. Match point was a well-placed forehand that went wide when Davenport tried to return it.
"She cranked it," Davenport said about the ace, which was the fastest serve of the tournament.
Williams holds the tour record for fastest serve, 127 mph, set in 1998 at Zurich in the quarterfinals against Mary Pierce.
"I still haven't broken my record yet ... which is something I've got to do," Williams said.
Davenport and Williams have met 14 times, with Davenport winning nine matches. Williams, however, has won four of the last five, including her first Grand Slam title at Wimbledon.
Williams made her professional debut in the Bank of the West in 1994, when it was played in Oakland. She has played in the tournament six times, but Sunday was her first title.
Only seven other women have won three consecutive tournament titles in the same event. Martina Navratilova won the Bank of the West three straight years, 1978-80.
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