Published: 2017-10-16 03:08:51 BdST
The Swiss world number two beat Nadal in the finals of the Australian Open and Miami Masters and in the last 16 at Indian Wells earlier this year, and never looked like losing to his long-time rival in Shanghai, firing 10 aces as he cruised to victory.
Federer, the only man who can still stop Nadal ending the year as number one, took an hour and 12 minutes to claim his sixth title of the year and his second Shanghai crown with a clinical performance.
"I wasn't here last year because of injuries, so it's just so, so nice to be back in Shanghai," Federer said.
"It's a wonderful moment for me to be back here playing against my good friend and rival, Rafa... We didn't think maybe we were going to have the year we did.
"I definitely didn't, so it's just nice to share this court with you today and hopefully there's more to come in the tournaments we've got left. It's been a pleasure playing against you again today."
Playing under a closed roof at the Qi Zhong Tennis Center, Federer sprinted out of the blocks, breaking Nadal in the opening game and the Spaniard had little answer to the sheer variety of shots coming across the net.
The Swiss refused to take his foot off the pedal in the second set, breaking Nadal to go 3-2 up and keeping his cool to wrap up victory.
He sealed the win on his opponent's serve, winning the second of three match points to claim his 94th career title.
Federer, who won the tournament in 2014, has enjoyed himself on the fast courts of Shanghai this year, while Nadal will look back on a successful stint in Asia after winning last week's China Open.
"I want to congratulate Roger and his team for a great year. Today I think you played a fantastic match, so many congratulations," Nadal said.
"This year has probably been the most successful of my career here in China... It's been a great two weeks and I feel very happy after a long year to be able to have the results here. It's very important for me."