Playing in her first final, the unseeded 19-year old is the first American to win the event since Chanda Rubin won back-to-back titles in 2002 and 2003, and she is the youngest American to win a singles title since Vania King (17 yrs, 254 days) triumphed in Bangkok in October 2006.
Keys' triumph also marks the first time that two American women have won titles in the same week since 2002, following Coco Vandeweghe's win, also on Saturday, at the grass-court Topshelf Open in the Netherlands.
It is the second defeat in the final for fifth-seeded Kerber, who fell to Tamira Paszek in 2012, and the third time she has lost a final this year after defeats in Sydney and Doha. She was seeking her first title came winning Linz in October 2013.
"I'm so incredibly happy," said Keys, who on Monday should be ranked in the top 30 for the first time. "You know, it's one of those things where when you're training and you don't want to be there, you're tired or everything hurts, it's one of those things where you think of this moment, and, you know, it really helps push you through all the hard times.
"My serve was definitely a weapon today, and it really helped me through the entire time."
Keys' win came after she fired 17 aces and struck a serve clocked at 126mph, the fastest this year on the WTA Tour and one that if confirmed would establish her as one of the top five fastest servers since records began in 1989.
Most of the rallies were short and just one break of serve decided the first two sets, with Keys breaking to lead 3-1 in the first and Kerber 2-0 in the second.
"It's always not easy when somebody is serving like she did the whole match," Kerber said. "She played at a really high level."
Kerber fought off two break points as she served out the second set, and games went with serve in the third until the dramatic 12th game. Kerber held two game points to take the set to a tiebreaker before Keys claimed victory on her fourth match point.
It's the first time the third-seeded Lopez has retained an ATP title, and the first time he has beaten Gasquet in their six meetings.
Lopez held championship point against Grigor Dimitrov last week at Queen's Club, and he is the first player to reach back-to-back grass-court finals before Wimbledon since 2001, when Lleyton Hewitt won at Queen's and s-Hertogenbosch, and Thomas Johansson won Halle and Nottingham.
There was little to separate him and Gasquet, with two breaks giving the Spanish left-hander the opening set, and Gasquet, the 2005 and 2006 champion, sneaking the tiebreaker in the second.
In the third set, games went with serve until Lopez broke to lead 6-5 and then served out for the fourth title of his career.
The Associated Press contributed to this report.