The 29-year-old world number two added the 2016 trophy to his 2013 triumph at the All England Club and his 2012 US Open breakthrough.
Appearing in his 11th final at the majors, but his first against an opponent other than Novak Djokovic and Roger Federer, the Scot put on a Centre Court masterclass.
Murray buried his head in his towel and wept in the moments after victory.
"It's the most important tournament for me every year. I've had some great moments and tough losses. I played some really good stuff today," Murray said.
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Murray faced just two break points in the two hour 48 minute encounter while 25-year-old Raonic, who had clobbered 137 aces going into the final, managed just eight on Sunday.
"It's a difficult challenge. Andy has been playing great and he deserved to win, congratulations to him," Raonic said.
"This one is going to sting. I'm going to make sure I do everything I can to be back here for another chance."
Victory for Murray helped make up for the disappointment of losing the Australian and French Open finals to Djokovic this year.
Raonic was attempting to become the first Canadian to win a Slam title but he was thwarted by Murray's tough-as-teak defence and inspired return game.
In the final analysis, his 29 unforced errors compared to Murray's miserly 12 proved fatal in a match where serve was broken just once.
Victory preserved the iron-grip on the majors of the sport's 'Big Four' with Lleyton Hewitt the last man outside of Murray, Djokovic, Federer and Rafael Nadal to win Wimbledon back in 2002.
- Rush of blood -
Fittingly for such an occasion, the Centre Court Royal Box was packed with sporting and celebrity star power.
Prince William and wife Kate were joined by former champions Bjorn Borg, Boris Becker and Stefan Edberg as well as Hollywood actors Bradley Cooper, Benedict Cumberbatch and Hugh Grant.
(REOPENS FGN 47)
The second seed was unable to convert his first break point in the seventh game but deservedly edged ahead at 4-3.
In a rush of blood to the head, Raonic came to the net off a weak approach and Murray gleefully fired back the ball to induce the crucial error.
Murray backed up the break for 5-3 before Raonic took the ninth game in which he fired his first ace of the final.
He had gone into the match having hit 137 aces in the previous six rounds.
A straightforward volley allowed Murray to claim the opener 6-4 with Raonic having hit just nine winners.
Raonic remained under siege, saving another break point in the first game of the second set, one more in the seventh and two more in the ninth as he clung on although his escape was aided by two Murray backhand errors.
Murray remained in cruise control, breezing through the tie-break for a two sets lead.
He still hadn't faced a break point in the final while Murray's unforced error count was just six.
Raonic did carve out his first break points in the fifth game of the third set but Murray saved both.
Another tiebreak was required and again Murray dominated, stretching out to five match points.
Raonic saved one but Murray claimed victory was assured when the Canadian netted a return.