The Mercedes driver, in dominant form all weekend at the Suzuka circuit, pumped in a one minute 27.760 second lap on the super-soft tyres while it was still only just spitting with rain.
Vettel and Ferrari team-mate Kimi Raikkonen, who went out on intermediate tyres in the final part of qualifying with the track still dry, lost time coming back in to fit the super-soft tyres.
The German then made another mistake on his first flying lap and was unable to get another one in as the intermittent drizzle turned into a full-blown shower that drenched the track.
Meanwhile, Hamilton — who along with team mate Valtteri Bottas had gone out straight away on the super-soft tyres to beat the rain — was lighting up the timing screens.
“The team have done an amazing job this weekend, and the call that we made for Q3 was probably the most difficult,” said the Briton, joined by Bottas on the front row after the Finn completed a second successive Mercedes front row lockout.
“It’s so difficult when the pressure is on to make the right call but that’s the big difference between us this year and that’s why we’re the best and the team deserve it,” added Hamilton.
Vettel trails his fellow four times champion by 50 points in the standings with just four races left after Japan. His hopes are fading fast and he needs a huge stroke of luck now to reignite his challenge.
“Obviously it’s not the position we deserve to be in,” said the 31-year-old. “I think we have better speed than ninth but we’ll start there and see how it goes.
“Anything can happen tomorrow. Tomorrow is a new day.”
Vettel’s misfortune allowed 21-year-old Dutch driver Max Verstappen to qualify third for Red Bull.
“We have a bigger chance now to be on the podium,” said Verstappen, doubting that he would need to worry too much about the others’ title battle: “Is it still a battle? I’m not sure,” he said.
While the Dutchman celebrated, team mate Daniel Ricciardo was left hoarse with anger after a power unit problem sidelined him during the second phase of qualifying before he had set a time.
The Australian, as a consequence, is set to start 15th.
“I just can’t catch a break,” said Ricciardo, who is leaving Red Bull for Renault at the end of the year.
Toro Rosso starred in what is a home race for engine-supplier Honda with New Zealander Brendon Hartley sixth ahead of French team mate Pierre Gasly in seventh.
“I’m stoked with that. I was actually a bit emotional on the in-lap,” said Hartley, who has had a tough time this year and faces an uncertain future.
Rivals McLaren, who dumped Honda for Renault after three frustrating years, meanwhile could do no better than 18th and 19th.
The retiring Fernando Alonso beat Stoffel Vandoorne but neither driver made it past the opening 18-minute part of the session.
Sweden’s Marcus Ericsson briefly brought out the red flags when he crashed his Sauber at the fast left-handed Dunlop curve early in the session.
Renault’s German Nico Hulkenberg, who crashed in the final practice session ahead of qualifying, made it back out on track but was also knocked out in the first phase having set the 16th quickest time.
That could be bad news for the fourth-placed French team, with their closest rivals Haas having Romain Grosjean qualify fifth.
Hamilton has won five of the last six races and is already in a position where he does not need to win again this year to clinch the title. The Briton won from pole in Japan last year.