Three strokes behind leader Tseng entering the round, the third-ranked Pettersen closed with a 5-under 67 for a two-stroke victory over second-ranked Stacy Lewis.
Pettersen finished at 20-under 268 for her 12th LPGA Tour victory. The 32-year-old Norwegian also won the LPGA Lotte in Hawaii in April and won a Ladies European Tour event in March in China. She won the 2011 tournament at Pumpkin Ridge.
"I felt like this was a good bounce back from last week when I kind of screwed it up on the last day," said Pettersen, who finished eight strokes behind winner Lydia Ko in the Canadian Women's Open after beginning the final round a shot back.
"I tried to give myself chances. Once I got going I felt like I made a lot of clutch putts. I guess that's what made me win today. The putter was a good friend of mine."
Tseng followed her third-round 63 with a 78 to tie for ninth at 12 under. The Taiwanese star, a 15-time winner on the tour who had a 109-week run at No. 1 in the world ranking, is winless in 37 events since the Kia Classic in March 2012.
Lewis, a three-time winner this year, shot a 68.
"It was a little frustrating. I played really good, though, so I can't be upset," Lewis said. "A lot of those putts I hit exactly where I wanted to and they just didn't go in. A bogey-free tournament I've never done before, so I keep checking things off the list."
Lizette Salas was third at 17 under after a 69, and 2008 champion Cristie Kerr was another stroke back after a 69.
A 72-hole event for the time, the tournament returned to Columbia Edgewater after four years at Pumpkin Ridge. Columbia Edgewater also was the tournament site from 1990-2008.
For Pettersen, the Safeway victory capped an emotional three-week period. It started with Solheim Cup, where Pettersen helped Europe rout the United States in Parker, Colo.
"Seems like Portland is a good stop for me," Pettersen said. "Seems like I always play well here. This was a good finish to a solid three-week stretch for me."
A key point during Pettersen's final round was her response after hitting a poor 8-iron at the par-3 second hole that led to a double bogey.
"I felt like an amateur, to be honest. That was a disaster of a hole," Pettersen said. "I decided before I went out (Sunday) just not to have too many reactions, good or bad. I knew there were birdies out there if you really get it going."
Pettersen started quickly with a birdie on the par-4 third that started a stretch where she birdied five of the next six holes and eight of 11.
Pettersen made an 18-foot birdie putt at the par-3 eighth to overtake Lewis for the lead, curled in a 5-footer for birdie on the par-5 10th and made a 25-footer from off the green on the par-4 11th.
Pettersen opened up a four-stroke lead with an 8-foot birdie putt on the par-3 13th. She ran into trouble at the 175-yard, par-3 16th, following a short tee shot with a poor chip. But she minimized the damage when her next chip rolled within 3 feet to set up a bogey-saving putt.
Pettersen said she didn't know she had a three-stroke lead on the 16th tee.
"It was a pretty bad swing. Even worse chip. But it was a good 4," Pettersen said.
Pettersen closed out the tournament with two pars.