The Australian, who has an unassailable 270-point lead in the championship with four rounds still to go, joins Mike Hailwood and Giacomo Agostini as only the third man to win four successive world championships in the class, an achievement made all the more impressive by the fact that he almost had his right leg amputated following a crash in 1992.
Before the race Doohan had rejected suggestions that he was just here for the ride, only needing a top-seven finish to secure the title. He battled to start from pole position, qualifying less than a tenth of a second ahead of Spain's Carlos Checa.
Alex Barros, on a Honda, made the best start off the line, Doohan being swallowed up by the pack. But by the end of the first lap he had recovered to third place. Doohan then decided it was time to act, first easing past his team-mate, Tadayuki Okada, and then Barros before settling down for what was expected to be a procession.
The threat of Checa dissipated on the third lap when the Spaniard crashed out at McLeans, but his nearest challenger for the title, Okada, was determined to push him all the way.
The Japanese rider began to pressure Doohan, the Australian's Honda starting to twitch alarmingly coming out of the Melbourne hairpin. But there was no question Doohan would settle for a point. He has only been defeated once in the previous 10 races this season. That was in Jerez, Spain, by his team-mate Alex Criville, who is out of action with a serious wrist injury.
It was not until the start of the 20th lap that Okada made his move, reeling in Doohan before slipping through on the inside going into Redgate. The Australian had to wait another four laps to regain the lead as he caught Okada unawares along the Schwantz curve.
Finishing in grand style, Doohan set a new lap record of 1:32.856, smashing Kevin Schwantz's six-year-old mark and also equalling his three consecutive victories at Donington.
Barros secured his first podium of the season with third place while Britain's only rider, the wild card entry Jason Vincent, finished 14th which may be enough to earn him a full-time place in the series next year.
"Okada was giving me a hard time out there and I didn't know if it was possible to win," Doohan said afterwards. "But I wasn't riding for points, winning the title wouldn't be the same if I did that.
"To win four titles is more than I ever imagined when I started. Hopefully, next year we can go for it again," Doohan said, although he would not confirm his 10th season in grand prix would be with Wayne Rainey's Yamaha outfit. A pounds 5m move by Honda to retain his services has been much rumoured.
"I thought I'd have racing out of my system by the time I got to 32 but I don't feel any different than when I started. Next year will probably be my last though. Racing is the easy part, I'm just tiring of other bits of it."
Earlier, in a thrilling finish to the 125cc Grand Prix, the championship leader, Valentino Rossi, and Tonomi Manako traded the lead throughout the race, Rossi triumphing after Manako lost control of his Honda at the final corner.
Germany's Ralf Waldmann took the 250cc class, moving to second place in the standings behind the runner-up, Tetsuya Harada. Max Biaggi, the triple world champion, slipped to third after crashing out on the 17th lap.
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