Kipyegon, silver medallist two years ago, took up the running with 600 to go and was stride for stride with in-form Sifan Hassan until the Dutchwoman faded while the Kenyan stayed strong to cross the line in four minutes 2.59 seconds.
Jenny Simpson of the United States, the 30-year-old 2011 champion, also showed great track nous as she slipped up the inside and finished like a teenage sprinter to take second.
South Africa's 800 metres specialist Caster Semenya also powered through on the line to grab the bronze.
"I knew it would be fast, it is such a quality field," Kipyegon said. "The best was going to win here. It was always going to be quick and competitive."
After a relatively low-key night's action, the 55,000 crowd roared their encouragement to home hopes Laura Muir and Laura Weightman to create a vibrant atmosphere.
Muir had travelled to Rio de Janeiro with real medal hopes last year after a stellar season but failed to live with the last-lap pace in the Olympic final and finished seventh.
This time she had vowed not to repeat that error and set the pace from the start and, although it was not a particularly punishing one, her positive move sent the crowd into a frenzy.
After a slow second lap, Kipyegon and Hassan, the fastest over the distance in the world this year, took it up with 600 to go as Muir and Simpson stayed in their wake in a thrilling last 300.
But it was the Kenyan who had the superior staying power as she drove through the line for a brilliant win to follow her 2016 triumph at the Olympics in Rio.
Hassan, who slipped to fifth, and then Muir, fourth, ran out of gas over the last few metres, allowing Simpson and Semenya, who has barely run a 1,500 in her career but has been unbeatable over two laps, to snatch the minor medals.
-The Star|