He led a 1-2 for his country with Sebastien Amiez taking the silver in a dramatic race which saw several favourites fall.
One of those who managed to complete both runs was Great Britain's Alain Baxter who claimed a sensational bronze - Britain's first ever Olympic skiing medal.
Baxter was assured of a medal when Bode Miller, bidding for a first gold of the Games, fell on his second run.
Miller, cheered on by his home fans, was desperate for a gold having already won two Salt Lake City silvers.
"We're all thinking a lot about somebody who's watching
us from up there. What a day for French skiing!
Amiez dedicates France's success to the late Regine Cavagnoud
There was also disappointment for Norway's Kjetil-Andre Aamodt who was seeking a third Games gold.
He fell on his second run with mistakes also ruling Croatia's Ivica Kostelic and Austria's Benjamin Raich out of medal contention.
Vidal's winning time was one minute, 41.06 seconds for the two runs, with Amiez finishing in 1:41.82 and Baxter clocking 1:42.32.
For Vidal it capped a remarkable return to the sport he feared he may never participate in again following an accident in 1999.
He was forced to spend two months in a wheelchair after smashing both his knees in a skiing crash.
He admitted: "When I had my big injury I thought that skiing was over for me. For me, it is super.
"I had that passion for skiing in my heart and all I had to do was light that fire inside me."
He becomes France's first Olympic slalom champion since Jean-Claude Killy in 1968.
Amiez, who came from nowhere to take his silver, dedicated the French 1-2 to the late super-G women's world champion Regine Cavagnoud.
The Frenchwoman died last year following a skiing crash.
"We're all thinking a lot about somebody who's watching us from up there," said Amiez, looking at the skies. "What a day for French skiing!"