Nadal had only lost one set in 11 previous finals in Catalonia and had never lost a clay-court final having held a match point.
He had two in the second set but a combination of uncharacteristic misses from the Spaniard and brilliant play from his opponent helped Tsitsipas turn the match around.
Rafael Nadal rode his luck as he saved a match point to win his 12th Barcelona Open title
The Greek had his own chance to clinch back-to-back titles, having won his maiden Masters crown in Monte Carlo last week, when he held match point at 5-4 in the decider.
But Nadal dug deep, broke the Tsitsipas serve in the next game and battled his way to a 6-4, 6-7 (6), 7-5 victory in three hours and 38 minutes.
Nadal, 34, will leapfrog Russian Daniil Medvedev to take back the world No 2 spot in the updated ATP rankings on Monday.
The 20-times Grand Slam winner will be back in action at next month’s ATP Masters 1000 tournaments in Madrid and Rome looking to carry the momentum into the French Open.
The Spaniard beat Stefanos Tsitsipas a 6-4, 6-7 (6), 7-5 in three hours and 38 minutes