Watch every event from the 2021 UCI Road Cycling World Championships in Flanders, with coverage on SBS OnDemand and SBS VICELAND from September 19-26.
The 23-year-old Balsamo benefited from veteran Elisa Longo Borghini's selfless work in the final straight and started her effort far from the line to hold off the great Dutchwoman Vos, winner of the title in 2006, 2012 and 2013.
Katarzyna Niewadoma of Poland ended up taking third place.
Balsamo's victory capped remarkable teamwork by Italy, who stayed together all day long on the 157.7km course from Antwerp to Leuven.
The Dutch looked to wear down their rivals by attacking one after another, including Demi Vollering after she fought her way back into the main group following an untimely mechanical.
The moves, however, failed to disorganise the Italians.
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"I'm totally speechless, it's unbelievable," said Balsamo, who burst into tears after crossing the line.
"It was a dream for me after this long season, and my team was so good. After the last corner, I only switched off my brain and said 'You have to go full gas'."
"It's really nice when your tactic really happens and you believe in what you are here for," added Longo Borghini.
"I knew that I had to close all the gaps, I felt really well today and I also had to be the last one launching Elisa for the sprint. From the beginning of the day, I felt like Elisa could win so when you believe in something and you really work for it, most of the time it happens."
Margarita Victoria Garcia Canellas opened a decent gap with about 25 kilometres left but the Dutch worked together and the Spaniard was reined in 10 kilometres from the line.
Vollering increased the pace to prevent further attacks as what was left of the peloton was fully stretched.
None of Vos's teammates had the legs to set her up for the final sprint but the 34-year-old managed to tuck herself in Balsamo's slipstream.
The 23-year-old track cycling specialist kept her composure and risked everything by launching her sprint far from the line to give Italy their first women's title since Giorgia Bronzini in 2011.
The Netherlands had claimed six of the 10 titles since, including the last four.
Defending champion Anna van der Breggen was never in contention in her last race as a professional rider.
Australia's challenge never really got going, with Rachel Neylan finishing as their top rider in 24th place, 45 seconds off the pace.
Sarah Roy was 38th, Tiffany Cromwell 41st, Lauretta Hanson 92nd, Amanda Spratt 93rd and Jessica Allen 111th among the 117 finishers. Chloe Hosking was among 45 non-finishers.
The UCI Road World Championships wraps up on Sunday, Sept 26 with the Elite Men's Road Race which will be broadcast LIVE, FREE and in HD on SBS On Demand from 6:15PM (AEST) and SBS Viceland from 9:30 pm (AEST)
