Fuglsang had sat in third place at 1-15 at the beginning of stage eight, and finished 1-15 ahead of Porte after he won the 115km stage to the summit finish on Plateau de Solaison, taking a 10 second time bonus on the line to confirm overall victory.
The Dane had attacked a group of GC contenders, including second place Chris Froome (Team Sky), with 7.3km remaining on the stage after Dan Martin (Quick-Step) had initially attacked. Porte was already over a minute behind the leading group, having been distanced towards the top of the penultimate climb of the Col de la Colombière.
The narrative had the day had been surrounding Froome and Porte, with Froome putting in numerous attacks to try and unseat the Australian.
But Froome faded after Fuglsang's attack, and was eventually caught by the pursuing Porte on the final climb and finished well off the pace at 1-27, losing his podium place to Dan Martin, who had finished second on the stage.
How it happened
The racing expectedly got off to a flying start on such a short stage, with a more than 20-rider break getting up the road towards the first climb of the Col des Saisies.
But they never seemed like they were going to get the opportunity to build substantial gap on the peloton, with so many of the GC contenders needing to make an early attack stick if they were to overturn their deficit to Richie Porte.
Alejandro Valverde (Movistar) was the first to try on the opening category one climb but was quickly pulled back, before Chris Froome launched his first move of the day in an attempt to get an early move to stick. He had teammate David Lopez in break up front, with Sky playing a clear tactic of getting a rider up the road to support Froome.
The Brit's attack however was short-lived, and simply reduced the peloton down to around 40 riders, with Porte losing most of his team-mates.
A break, with Tony Gallopin (Lotto-Soudal), still lead heading on to the second climb of the Col des Aravis with around 66km to go, but Sky again tried to get a rider away with Michal Kwiatkowski jumping from the peloton with Simon Clarke (Cannondale-Drapac).
Froome once again accelerated at the top of the second climb but wasn't able to gain any ground, with Kwiatkowski trying to sit up out front to support him over the summit of the Col des Aravis.
Eventually the climbing took its toll and the remnants of the breakaway were caught, with Valverde the next to try and go clear on the third climb of the Col de la Colombière.
He was eventually joined by Fabio Aru (Astana), with Dan Martin, Fuglsang and Romain Bardet (Ag2r) accelerating in pursuit from the yellow jersey group with 6km to go to the top.
Porte and Froome appeared to be marking each other up the Colombière, and were happy to let other riders slip away, with Valverde and Aru carrying 1-22 on the over the summit and 31 seconds on the Fuglsang group.
But Froome then once again tried to distance Porte and attacked 500m from the top of the penultimate climb.
Porte seemed to struggle, and let Froome go who summited the climb with 15 seconds in hand.
Froome caught the Fuglsang group on the descent with 25km remaining, and Porte was now around 40 seconds back and looked to be losing his grasp on the yellow jersey, with no team-mates to help him.
Eventually the front groups came together with Aru and Valverde caught on the foothills of the Plateau du Solaison, with Porte trailing by 1-12 as he rode solo to try and catch the leading group.
Froome did a lot of the work on the early part of the climb, but wasn't able to respond when Dan Martin attacked with Fuglsang in pursuit with 7.3km to go.
Fuglsang rode away from Martin with 5.5km left, and Froome began drifting back towards Porte, losing ground, and his hopes of an overall win slipping away,
And as Porte caught Froome with 2.5km remaining to the summit, he still had one major rival out front and had to press on to close the 1-11 gap to Fuglsang.
Porte then dropped Froome, but it was increasingly looking like Fuglsang couldn't be stopped as he rode his way to a second stage win of the race.
The Astana man crossed the line and had to wait for Porte to see if he'd won overall, with the Australian crossing the line at exactly 1-15 down on Fuglsang.
But it wasn't enough, and Fuglsang can celebrate the biggest victory of his career.
Critérium du Dauphiné 2017 stage eight, Albertville - Plateau du Solaison (115km)
1 Jakob Fuglsang (Den) Astana Pro Team
2 Daniel Martin (Irl) Quick-Step Floors, at 12s
3 Louis Meintjes (RSA) UAE-Emirates, at 27s
4 Emanuel Buchmann (Ger) Bora-Hansgrohe, at 44s
5 Fabio Aru (Ita) Astana Pro Team, at 1-01
6 Romain Bardet (Fra) AG2R La Mondiale, at 1-02
7 Richie Porte (Aus) BMC Racing Team, at 1-15
8 Christopher Froome (GBr) Team Sky, at 1-36
9 Rafael Valls (Esp) Lotto Soudal, at 1-41
10 Alejandro Valverde (Esp) Movistar Team, at 3-30
Final general classification
1 Jakob Fuglsang (Den) Astana Pro Team, in 29-05-54
2 Richie Porte (Aus) BMC Racing Team, at 10s
3 Daniel Martin (Irl) Quick-Step Floors, at 1-32
4 Christopher Froome (GBr) Team Sky, at 1-33
5 Fabio Aru (Ita) Astana Pro Team, at 1-37
6 Romain Bardet (Fra) Ag2r La Mondiale, at 2-04
7 Emanuel Buchmann (Ger) Bora-Hansgrohe, at 2-32
8 Louis Meintjes (RSA) UAE-Emirates, at 3-12
9 Alejandro Valverde (Esp) Movistar Team, at 4-08
10 Rafael Valls Ferri (Esp) Lotto Soudal, at 4-40
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