The Briton's win caps of a sensational first week for his team Dimenson Data, who have now taken four wins from the seven stages after Mark Cavendish's three sprint victories.
Cummings had clearly targeted the 162.5km stage, which took in the category one Col d'Aspin and finished on a small rise after the descent in Lac de Payolle, working hard to make sure he was in the large breakaway group that got away.
After numerous attacks, a 29-man group finally formed after around 60km with the likes of Fabian Cancellara (Trek-Segafredo), Tony Martin (Etixx-Quick Step), Vincenzo Nibali (Astana) as well as race leader Greg Van Avermaet (BMC) and Cummings among them.
It was a fast start with the riders completing 49kmph in the first hour, but the 29-man group was able to get around five minutes, before things began to break-up for them over the first category four climb with 45.8km to go.
Cummings found himself among a group of four up front with Matti Breschel (Cannondale-Drapac), Daniel Navarro (Cofidis) and Anotine Duschene (Direct Energie), with eight men, including Daryl Impey (Orica-BikeExchange) Nibali and Van Avermaet chasing and closing the small gap they'd built.
But the 35-year-old Cummings wasn't willing to hang around to get caught, and attacked with 27km to go towards the foot of the Aspin. No-one was able to follow the fierce pace, and he had 30 seconds before a chase group of Impey, Nibali and Navarro formed behind with Van Avermaet slipping back.
By the time Cummings reached the summit of the climb, he had over a minute on the three behind and Impey and Navarro dropped Giro d'Italia winner Nibali.
Cummings was then able to play it safe on the descent of the climb, and easily held his gap as he ascended the final kilometre to the finish and secure his second career victory at the Tour de France.
Impey was able to win the sprint from the pair behind, with Nibali rolling in alone in fourth. Van Avermaet then finished in fifth, extending his lead in the maillot jaune to just under six minutes.
Behind there were no significant movements from the big GC contenders like Nairo Quintana (Movistar) or Chris Froome (Team Sky), but Frenchman Thibaut Pinot (FDJ) was the biggest casualty as he failed to hold the pace and lost well over two minutes to the leading GC contenders.
There was more drama in the closing kilometre however, after the inflatable Flamme Rouge collapsed as the GC riders approached. Adam Yates (Orica-BikeExchange) looked to take a hard fall because of it, having gained seven seconds on the group after attacking over the summit.
Yates was later awarded the gap that he had at the 3km-to-go point, and moved up to second overall and into the lead in the best young rider's classification.
Saturday's stage eight sees another tough Pyrenean stage, taking in four categorised climbs over the 184km route from Pau to Bagnères-de-luchon.
Tour de France stage seven, L’Isle-Jourdain - Lac de Payolle (162.5km)
1. Steve Cummings (GBr) Dimension Data, in 3-51-57
2. Daryl Impey (RSA) Orica-BikeExchange, at 1-05
3. Daniel Navarro (Esp) Cofidis, st
4. Vincenzo Nibali (Ita) Astana, at 2-14
5. Greg Van Avermaet (Bel) BMC, at 3-04
6. Luis Angel Mate (Esp) Cofidis, at 4-29
7. Geraint Thomas (GBr) Team Sky
8. Wout Poels (Ned) Team Sky
9. Gorka Izagirre (Esp) Movistar
10. Alejandro Valverde (Esp) Movistar, all same time
General classification after stage seven
1. Greg van Avermaet (Bel) BMC in 34-13-40
2. Adam Yates (GBr) Orica-BikeExchange at 5-50
3. Julian Alaphilippe (Fra) Etixx-Quick Step at 5-51
4. Alejandro Valverde (Esp) Movistar at 5-53
5. Joaquin Rodríguez (Esp) Katusha at 5-54
6. Chris Froome (GBr) Team Sky at 5-57
7. Nairo Quintana (Col) Movistar at 5-57
8. Warren Barguil (Fra) Giant-Alpecin at 5-57
9. Pierre Rolland (Fra) Cannondale at 5-57
10. Dan Martin (Irl) Etixx-QuickStep at 5-57
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