By Mark Meadows
The top seed, whose victory here last year made him the first man in the professional era to triumph in the same tournament six times in a row, showed few signs of letting his grip on the trophy loosen despite a generally scrappy display.
"King of Clay" Nadal first broke in the third game when his compatriot netted but Ferrer struck back immediately with his own break of serve thanks to an exquisite drop shot in the final of the first claycourt event of the European season.
However, Ferrer's joy was short-lived with Nadal breaking next game and winning the first set before seizing the initiative in the second with a superb passing shot only to be broken in the eighth game and then hitting back for 6-5.
He leapt into the air with delight when Ferrer hit the net to seal his victory in one of the world's most glamorous spots.
"It's perhaps the best tournament in the world," Nadal beamed after picking up a trophy he virtually owns.
"I congratulate David on his good start to the year and wish him well. For me today is very special, to win here seven times is much more than a dream. I could never have imagined it."
Ferrer defeated an injured Nadal in the last eight of January's Australian Open but this time the world number one, who beat Fernando Verdasco in the principality last year in another all-Spanish final, was too strong on his forehand.
The 24-year-old has arguably not been at his very best this week at the beachside event, and was pushed hard by Andy Murray in Saturday's semi-final, but even the odd problem with his serve or failure to kill off a point have not cost him.
Novak Djokovic beat Nadal in his previous two finals on hardcourts this year but he pulled out of this tournament with a knee injury, robbing fans of the chance to see whether the Serb could threaten the Spaniard on his favored clay surface.
Roger Federer lost in the quarter-finals when the Swiss had seemed on a collision course toward the final with his great rival Nadal, but fourth seed Ferrer put up a decent fight instead with his family watching from the sun-kissed galleries.
Other notable spectators at the Monte Carlo Country Club were Prince Albert of Monaco, who had a knock-up on the courts before play, and U2 singer Bono, while a super yacht was anchored in the bay just below one of tennis's most idyllic venues.
"Generally I'm happy, I'm happy with my game," Ferrer told reporters. "I was a bit sad about certain moments."
(Editing by Tom Pilcher and Sonia Oxley)