First-half goals from Michael Cain and Harry Panayiotou gave the Foxes a memorable 2-0 victory at Hong Kong Football Club and brought to an end Newcastle's 11-game winning streak in the tournament.
Leicester won the second-tier Shield on their first visit to Hong Kong 12 months ago but this year the Championship club upstaged their Premier League counterparts - who also included Manchester City and Aston Villa - to lift the Cup.
"We had the experience of playing in last year's tournament and I think we also benefited from the freshness of the new players we brought this time," said coach Jon Rudkin. "There are some excellent teams here so we're delighted to be winning a tournament of this standard."
Leicester lost 2-0 to Newcastle in their group clash on Saturday and Rudkin said his team had used that experience to prepare for the final.
"We learnt a lot from that first game," he revealed. "We were aware Newcastle had some excellent players and they've been tremendous in this tournament, not just this year but last year as well. But we knew the final was a one-off game so we just had to dig in and give it a go."
Rudkin paid tribute to 18-year-old striker Panayiotou, who scored five goals during the weekend and was named Player of the Tournament.
"He's a strong boy, he's hard to mark and he's always going to go and get you goals. He's done well here. But all the players have stood out with the way they have coped with the heat and competed so well in this tournament environment. I'm delighted with them."
After winning all six of their matches at the Soccer Sevens last year, Newcastle won their first five this time around but had no answer to Leicester's flying start in the day's final game.
Coach Willie Donachie refused to be downhearted. "The first goal is important in a tournament like this and especially in a final," he said. "But the players gave everything they had and hopefully they'll learn from the experience."
Earlier, Leicester knocked out five-time Soccer Sevens winners Aston Villa with a thrilling 4-3 victory in extra time of their quarter-final.
Leicester raced into a three-goal lead thanks to Jak McCourt and a Panayiotou double before Villa replied with two goals from Jack Grealish, the second a penalty, and Jerell Sellars. But Leicester bounced back to win it with a golden goal from Cain.
Panayiotou was on target again to give the Foxes a 1-0 win over Sunderland in the semi-finals.
In the Masters competition, Rangers All Stars stunned defending champions Aegon Ajax All Stars 2-1.
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