The top-seeded Federer hit eight aces and conceded just seven points on his serve all match.
"I'm very happy, everything worked as planned," Federer said. "It was a match played at a high level."
It was Federer's fourth title of the season after victories at the U.S. Open, in Estoril, Portugal; and Halle, Germany. He is 4-4 in finals this season and 57-21 overall.
Federer improved to 10-8 against the 26-year-old Nalbandian, who won in Basel in 2002 and is a three-time runner-up.
The 27-year-old Swiss broke to lead 4-2 in the first set and again in the third game of the second set.
The fourth game of the first set epitomized the high-quality tennis. Nalbandian saved five breakpoints, twice with aces, and eventually held after six deuces.
Federer kept up the pressure on his opponent's next service game, creating two break points with a forehand passing shot on the run. Nalbandian then hit a forehand long to drop serve.
Federer held to love in the next game, helped by two heavily sliced aces to the Argentine's forehand. He clinched the set with an ace and three service winners.
In the second set, Federer hit a backhand crosscourt winner to break Nalbandian and lead 2-1.
Federer closed out the match with a forehand winner behind a big serve.