The pair went to the tee of the 72nd hole all square after Lee dropped a shot at the 17th while Jutanugarn made a birdie to join her atop the standings.
But the roles were reversed on the very next hole, Lee showing tenacity to overcome the drama at the 17th and post her third birdie of the week at the finishing hole while Jutanugarn capitulated.
The long hitting Thai player, who often doesn’t carry a driver including this week, pulled her 3-wood tee shot into water and drowned her tournament hopes with one poor swing.
To that point it had been a thrilling final 18 holes as Korda, Jutanugarn and Lee fought out the title on a breezy Jian Lake course on Hainan Island.
Lee made an unlikely birdie at the first with a chip in from over the green to set the tone for an eventful final round.
She made her second birdie of the day at the 8th to take a three shot lead and looked to be in control with a string of seven straight pars.
But at the par-3 17th she stumbled just as Jutanugarn was producing her best golf, the Thai star making her third birdie of the back nine and fourth of the day to catch Lee.
With five victories already in 2016 and likely Player of the Year honours heading her way, Jutanugarn looked to have the momentum but couldn’t finish the job with her poor finish.
Korda, too, had her chance at the reachable final hole but her second shot rolled through the green and she could only make birdie to finish one back.
For Lee the victory was the culmination of a solid year’s golf which has seen her post six top 10’s in 24 starts.
“I feel like I've been playing really solid golf the whole year,” Lee said after her round.
I know I won in Hawai'i, but like getting a win this week, it feels really good.
“I knew I had to have - it was going to be a really good battle today, and that's exactly what happened. I'm glad I came out on top but it was a really good fight out there.”
Lee said even after Jutanugarn found water off the final tee she couldnt take her position for granted.
“On 17, I had a 3-putt and I made bogey. The score was tied on the last hole. And then Ariya hit it in the water with her drive,” she said.
“I knew that I had a good opportunity but I was getting ahead of myself. I knew that either Jess was going to make birdie - was probably going to make birdie, and so I thought to myself, I need to make birdie here.
“I just put myself in good spots and then yeah, I ended up making birdie. Yeah, just stuck to my game plan.
Runner-up Korda was philosophical about her finish after not getting the opportunity to practice on the course prior to the tournament because of a typhoon in the area.
“Looking back at this week, I think considering we had zero preparation for the tournament and came in on Wednesday, I think I would have taken a second place if you would have told me that that's what I would have gotten,” she said.
“Everybody out here kind of had the same thing. But like I said, if somebody was going to tell me at the beginning of the week that you were going to be second, I would have been like, all right, that's cool.”
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