The world number one produced his strongest night of the league phase so far, recovering from an uneven quarter-final to deliver high-quality displays in the semi-final and final.
The final itself against Clayton quickly developed into the match of the night, with both players sustaining a relentless scoring pace and trading legs throughout.
The standard peaked in a remarkable mid-match passage in which both players threatened nine-dart finishes in the same leg, before Littler came closest, landing eight perfect darts and missing double 15 for a nine-darter.
The leg ultimately went with the throw, keeping the contest on a knife-edge.
At 4-4, the decisive moment came when Clayton missed opportunities on a finish of 81, allowing Littler to break and move within a leg of victory.
Littler then completed the win to take the title in Cardiff, punctuating the final with another 170 checkout during the match and celebrating emphatically after securing the crucial break, taking out 52 for the outright victory.
'I'm proud of myself'
"It took a while to get settled in, as it did in the first year," Littler told Sky Sports straight after the final.
"Tonight, I've done really well, and I'm proud of myself.
"I said in my pre-match interview, every week I felt good, but I've just not shown it. Even practicing, I've been playing well.
"But I'm just glad tonight I could take practice and bring it on to where that's what I've done."
Littler began the night with a 6-4 win over Josh Rock, a match in which he was not at his sharpest but did enough to progress, while Rock again struggled to convert chances on the doubles.
The Nuke then raised his level significantly against Gerwyn Price in the semi-final, winning 6-3. He mixed heavy scoring with timely finishing, including a 170 checkout in the closing stages to seal the match and book a place in the final.
Humphries still struggling
Elsewhere on the night, Clayton reached the final by defeating Luke Humphries in the semi-finals after earlier overcoming Gian van Veen.
Humphries had opened the evening with a 6-1 win over Michael van Gerwen, while Price edged Stephen Bunting 6-5 in a last-leg decider before being eliminated by Littler.
The result gives Littler a timely boost in the Premier League campaign, while Clayton, who has started the season strongly, took another set of valuable points in front of a supportive Cardiff crowd despite missing out on a second nightly win.
The Premier League continues next Thursday at Nottingham's Motorpoint Arena.