Having never won a race in Austria, the Spaniard executed a flawless race from fourth on the grid to take his 12th sprint victory in 13 rounds this season, underlining his supreme dominance in the shorter format.
The victory moves Marc Marquez 123 points clear of Gresini Racing's Alex Marquez at the top of the championship and 180 above Ducati teammate Francesco Bagnaia, who was forced to retire due to problems with his bike.
KTM's Pedro Acosta came third in the team's home race to complete an all-Spanish podium, while Aprilia's pole sitter Marco Bezzecchi finished fourth.
"I was super confident in the start and then I was able to be second but I saw immediately that it was quite difficult to be close to Alex," said Marc Marquez, who is unbeaten since the British Grand Prix in May.
"I decided to wait a bit and when the tyres start to drop is when I feel better and I started to push."
He dedicated the victory to Pau Alsina, a 17-year-old JuniorGP Spanish rider who died due to injuries sustained in a training accident last month.
"Super special sprint victory because I want to say that it's for Pau Alsina. We miss him," he added, while pointing to Alsina's number 26 on the back of his helmet.
"I don't know what will happen tomorrow but the race is for him."
Wheelspin for Bagnaia
Bezzecchi had claimed his first pole with Aprilia earlier on Saturday but was beaten to turn one by Alex and Marc as the Marquez brothers dropped the Italian down to third while a wheelspin for Bagnaia dropped him 11 places to 14th.
Bezzecchi soon found himself going backwards as Acosta made a smooth overtake on the inside to move up to third while Alex set the early pace with the fastest lap.
But Acosta was soon losing ground to the Marquez brothers who have been in another league this season, especially in the sprints.
Bagnaia seemed to be struggling with his bike and the Ducati rider dropped to the back of the field before retiring from the race, his face like thunder inside the pit lane.
His teammate Marc, however, pounced with five laps to go to take the lead from his brother on turn three and immediately began extending his advantage, going more than half a second clear two laps later.
There was no catching Marc as he claimed his 20th victory in sprints and races this season but Alex was happy to finish second again after missing out on the podium in the last two rounds.
"I'm super happy, I had a quite clear target," Alex said.
"When I saw Marc behind and I know that he was faster than me I did a mistake, so there's nothing more to do but at the end we were there. We have a great level again, so I'm really happy to come back like this after the summer break."