The 26-year-old former BMC and Orica-GreenEdge rider followed Cavendish's attack in the final 500m to the left of the lead group and after a clash of shoulders outmuscled his WorldTour rival.
Andy Fenn of Team Sky finished third a few bike lengths back, with his teammate Alex Peters animating the race in the build-up to the final sprint.
Peters and Blythe were part of a four-man breakaway that looked to make it to the end of the six finishing laps in Stockton town centre, along with Tao Geoghegan Hart (Axeon Hagens Berman) and Tom Moses (JLT Condor).
Cavendish's group, which contained the likes of Fenn, Scott Thwaites (Bora-Argon 18), Chris Lawless (JLT Condor) and Kristian House (One Pro Cycling), sat around 30 seconds behind the four leaders with two laps to go.
But with just one lap remaining an acceleration by Cavendish finally brought them back, which is when the attacks started with regularity.
The man regularly at the head of the attacks was Peters, who dug deep to try and get away once more, but each time he was dragged back and eventually had nothing left to give.
With Cavendish still with the group heading into the final corner there only looked to be one winner, but Blythe went with the Manxman as he opened his sprint and the duo battled shoulder to shoulder.
A touch of bodies looked to put Cavendish off his rhythm a little in the final metres but there were no complaints from the 2011 world champion as they crossed the line.
Geoghegan Hart, whose partner Hannah Barnes won the women's race earlier in the day, picked up the Under-23 title ahead of Lawless and James Shaw (Lotto-Soudal U23).
British National Championships elite men's road race, Stockton-on-Tees (207km)
1. Adam Blythe (Tinkoff)
2. Mark Cavendish (Dimension Data)
3. Andy Fenn (Team Sky)
4. Mark McNally (Wanty-Groupe Gobert)
5. Scott Thwaites (Bora-Argon 18)
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