The 31-year-old Russian dominated the No. 3-ranked Ferrer throughout, breaking the defending champion and local favorite four times on the indoor hard court.
Youzhny used well-placed ground strokes early on, breaking twice to take the first set. Ferrer appeared to have recovered with a break in the second, but Youzhny broke back and the Spaniard then started to berate himself after each miss.
Meanwhile, Youzhny methodically kept hitting his shots and broke Ferrer a final time to go up 6-5 before serving out the match.
"It was a great week for me and a great tournament," Youzhny said. "It was a great atmosphere. I felt nobody was against me, of course they were for David, but when I played well they applauded me."
It was his second title of the season after winning at Gstaad in July.
Youzhny finished runner-up here to Andy Murray in 2009.
Ferrer was vying to add to his three titles at Valencia, which is close to where he was born. After winning titles in Auckland and Buenos Aires, Ferrer has lost six straight finals.
"Losing at home hurts more," Ferrer said. "He served well, and I was lacking energy. I needed to return better and move the ball around more. In the second set I had more opportunities, but only at the start."