The 26-year-old Simpson, who triumphed twice on the PGA Tour last year, charged into contention with four birdies in five holes around the turn on the way to a two-under-par 68.
On a foggy afternoon at the brutally difficult Olympic Club, Simpson coolly parred his last eight holes to finish at one-over 281 as the other main contenders faded over the closing stretch.
"It was pretty nerve wracking," Simpson told NBC television after earning the winner's cheque for $1.44 million in the year's second Major. "I knew it was a tough golf course.
"I had to go out and do as well as I could. I probably prayed more the last three holes than I've ever done in my life. It helped me stay calm and get in with two under."
Simpson, who got up and down from greenside rough to save par at the last, became the ninth consecutive first-time winner of a Major, and the 15th different player in succession to claim one of golf's blue riband events.
Northern Irishman McDowell, US Open champion at Pebble Beach two years ago, closed with a six-bogey 73 to finish joint second with little known American Michael Thompson (67).
As Simpson and his wife Dowd watched on television, McDowell had a chance to force a playoff with a downhill birdie putt from 25 feet at the par-four last but his attempt slid past the left edge of the cup.
"I thought even though Graeme had a 25-footer, it was probably going to hit the hole or have a good chance," Simpson said after being presented with the glittering US Open trophy.
"I couldn't be happier right now. Congrats to Graeme and Michael for playing great golf."
McDowell rued a final round in which he hit only three fairways out of 14 off the tee.
"There's a mixture of emotions inside me right now, disappointment, deflation, pride but mostly just frustration," the 32-year-old said.
"That's the US Open. You're supposed to hit it in some fairways. And that was the key today really for me."
Furyk, US Open champion in 2003, briefly moved two strokes clear and was tied for the lead with three holes to play but bogeyed 16 and 18 for a 74 and a five-way share of fourth place at three over.
The 42-year-old failed to record a single birdie in the final round as he finished level with compatriots David Toms (68), Jason Dufner (70) and John Peterson (70), and Ireland's Padraig Harrington (68).
Furyk struggled to sum up his feelings after the disappointing final round.
"I don't know how to put that one into words, but I had my opportunities and my chances and it was right there.
"On that back nine, it was my tournament to win. I felt like if I had shot even par, one under, I would have distanced myself from the field. And I wasn't able to do so. I played quite well, actually until the last three holes."
Three-times champion Tiger Woods, aiming to end a four-year major title drought, never recovered from a bogey, bogey, double-bogey start and tied for 21st at seven over after returning a 73.
"I felt great on the greens, had the perfect speed all day and unfortunately just got off to such an awful start," Woods said. "I tried coming in, but I was too far out.
"But overall, the way I struck the golf ball, the way I controlled it all week is something that's very positive going forward."
The hilly Lake Course at Olympic posed all sorts of problems for the players, especially with its first six holes which Woods has described as the hardest start to any tournament.
However, organizers moved up some tee positions to create scoring opportunities in the final round and the fans were treated to some exhilarating shot-making, along with the relentless grind for pars so typical at a US Open.
One of the biggest roars of the day came when twice former champion Ernie Els rolled in a curling 20-foot eagle putt at the driveable par-four seventh to move into a tie for second.
But the smooth-swinging South African bogeyed the next two holes to derail his title bid.
British world number three Lee Westwood began the day three strokes off the pace but never recovered from a double-bogey at the fifth where he lost his ball after his tee shot sailed right into trees and never came down.