The 20-year-old from Haryana, who is a medical student, edged out top five contestants from England, France, Kenya and Mexico at the event, which saw participation from 118 countries.
Chhillar was presented the crown by Stephanie Del Valle, the last year's Miss World winner from Puerto Rico at an event held at a resort in the coastal city of Sanya.
"Thank you, everyone, for your constant love, support, and prayers. This one's for India," Chhillar wrote on her official Twitter handle.
In the top five round, Chhillar was asked which profession according to her deserved the highest salary.
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"I think a mother deserves the highest respect and when you talk about salary it's not always about cash but I feel it's the love and respect that you give to someone. My mother has always been the biggest inspiration in my life.
"All mothers sacrifice so much for their kids. So, I think it is the job of a mother that deserves the highest salary," Chhillar said to a wide-applause.
Aishwarya Rai had bagged the title in 1994, followed by Diana Haydon in 1997, Yukta Mookhey in 1999 and Priyanka Chopra in 2000, the last for India.
Chhillar's win brings India at level with Venezuela as the countries with most victories in the history of the pageant.
Taking to the Twitter, Haryana Chief Minister Manohar Lal Khattar praised Chhillar and said, "I congratulate Haryana's daughter Manushi Chhillar on winning the Miss World crown."
According to Chhillar's profile on the Miss World website, her father, Dr. Mitra Basu Chhillar, is a scientist at the Defence Research and Development Organisation, while her mother, Dr. Neelam Chhillar, is an associate professor and department head of neurochemistry at the Institute of Human Behaviour and Allied Sciences.
She aims to be a cardiac surgeon and wants to open a chain of non-profitable hospitals based in rural areas.
A trained Indian classical dancer, Chhillar has a passion for outdoor sports and actively participates in paragliding, bungee jumping, snorkelling and scuba diving besides sketching and painting.
Her personal motto, as described on the website, reads: "When you cease to dream you cease to live" and "Courage to give flight to your dreams and the ability to believe in yourself makes life worth living".