Ireland’s Cian O’Connor and Dutch rider Gerco Schroder faced a jump off to determine the silver and bronze medals after finishing tied with one time fault apiece.
Schroder took second place, posting a clear round with O’Connor finishing third after his mount, Blue Loyd 12, knocked a pole off the last fence.
The 30-year-old Guerdat, bronze team medallist in Beijing four years ago, took the title as the only rider to register two faultless rounds.
This was the first time individual jumping gold had been won by a Swiss rider since the 1924 Paris Olympics.
Great Britain’s hopes of winning gold for the first time were scuppered when Nick Skelton on Big Star picked up four faults to finish in a tie for fifth with fellow Briton Scott Brash and Mexican Alberto Michan.
Guerdat and Skelton were among a group of only six riders to go clear in the first round of the two-legged final.
And with the Swiss posting a second faultless display the pressure was on last man out Skelton to force the equestrian equivalent of a penalty shoot-out.
The evergreen 54-year-old and Big Star hadn’t put a foot wrong at London 2012, but with one pole down the pair failed in their bid to double up after claiming gold in Monday’s team competition.
“It’s just one of those things, Big Star hadn’t touched a jump all week,” said Skelton.
He added: “Everyone thought it was going well, I did too, but I just touched the pole at the wrong time and that was it.
“I feel sorry for the people that came today. We expected to win and it wasn’t to be. But we got one gold, we would have settled for that before we came.”
Saudi Arabia’s Kamal Bahamdan, with a time fault in each round on Noblesse des Tess, came in fourth.
Further back in a tie for ninth on eight faults came Ian Millar, the 65-year-old Canadian who was appearing at a record 10th Olympics.
The previous benchmark of nine Games was held by Austrian sailor Hubert Raudaschl.
Despite his years the bespectacled Millar is looking to the future, and Rio in 2016.
“Star Power wants to go and he cannot go without me,” he said referring to his 11-year-old gelding.
Notable names who failed to make it into the second round were Millar’s compatriot and defending champion Eric Lamaze, and France’s European champion Kevin Staut, who picked up 18 faults in an error-strewn display on Silvana.
Another to fall by the wayside was Saudi Arabia’s Prince Abdullah al-Saud, King Abdullah’s grandson.
One show jumping heavyweight who failed to even make it to the first fence was Rolf-Goran Bengtsson.
The Swedish world number one missed out when he was forced to withdraw his horse Cassall as he was deemed unfit to compete.
“I am very disappointed,” said the Beijing 2008 silver medallist.
“I have been working towards this since Hong Kong. But the horse has to be my first priority. Therefore it was a hard decision in one way, but it had to be made.”