The American, who won team sprint gold with Kikkan Randall at PyeongChang 2018, took overall victory after finishing second to Sweden's Ebba Andersson in the 10km mass start in Val Di Fiemme on Sunday (10th January).
Delphine Claudel was third on the final stage of the 10-day event which took in a gruelling climb of Alpe Cermis.
Diggins took the overall lead last Sunday in Val Mustair with victory in the 10km freestyle pursuit, and strengthened it two days later with her seventh World Cup triumph in Toblach.
She then held it with solid performances throughout the week, winning by 1:24.8 from Russia's Yulia Stupak with Andersson 36 seconds further back in third.
Norwegian women had won the last seven overall titles, but their national team missed the entire event due to COVID concerns.
Diggins told FIS afterwards, "This is a lifelong goal. It means a lot. We had an amazing team atmosphere this whole time and amazing support and help and so many cheers from all around the world so I think it really gave me wings up the hill today.
"It’s so cool for our country to show that it’s possible and now I’m looking forward to resting."
Bolshunov cruises to second men's title
Alexander Bolshunov retained the men's crown as he kept up his record of finishing in the top three in every stage of this year's race.
The 24-year-old, who won four medals at PyeongChang 2018, crossed the line 13.3 seconds after Russian team-mate Denis Spitsov in Sunday's final stage.
Maurice Manificat of France was a further 1.9 seconds back in third as he took second place overall ahead of another Russian, Ivan Yakimushkin.
It was a dominant performance from Bolshunov who was second in the opening sprint behind Italy's Federico Pellegrino before winning the next five in succession.
He was third behind Oskar Svensson in Saturday's sprint in Val di Fiemme before today's second place on the Alpe Cermis climb.
Bolshunov has already all but secured the overall World Cup title with PyeongChang silver medallist Pellegrino leading the sprint standings.
Speaking via an interpreter, Bolshunov told FIS, "I'm delighted to take my second consecutive Tour de Ski title.
"These 10 days went by very quickly and I'm very happy that FIS was able to organise this event. I felt safe and I'm really happy that I was able to win."