Lopez saved his match point with a steely volley at 5-6 in the breaker before Cilic fended off two.
Unseeded 35-year-old Lopez saved one match point on his way to a 4-6, 7-6 (2), 7-6 (8) win over world No 7 Marin Cilic, who missed out on the £350,000 winner's cheque.
"We had a great battle in the 2014 final so I knew it would be tough", said Lopez, referring to a match that featured three tiebreakers.
Yet for the first half of the match on Sunday, he was second best as Cilic, bidding for a second title after winning in 2012 when David Nalbandian was defaulted for injuring a line judge in a fit of temper, dominated.
"I am so happy to be in the final, it's one of the most special tournaments for me".
Cilic failed to convert his opportunities in the second set, however, and one lapse of concentration at 5-6 blotted his copybook to allow Muller to snatch the second set.
The most recent match was in this year's French Open, a match Cilic won in straight sets.
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Cilic broke to love in the 10th game of the match to take the first set and kept his nose in front in the second, only to falter badly in the tiebreak which Lopez dominated.
For comparison, Andy Murray's early exit means he has played two competitive grass-court sets ahead of the third grand slam of the year while Lopez, having reached the final in Stuttgart last week, has 27.
Lopez capitalised on a run of Dimitrov errors at 5-5 in the first set to break before holding serve easily.
"I kept my tennis on a really high level, played aggressive and mixed up my serve quite good, which was extremely important. I was mixing it up really well and just playing really smart in some critical points".
"I can not believe that I've finally won this trophy", Lopez said.
With his own serve still untouchable, that was all the advantage Cilic needed to close out the first set. In the victory, Lopez won 87 percent of his first serve points and 53 percent of his second serve points.