The 22-year-old world record holder got off to a flying start and raced away from the field to win in a new Paralympic record 14.75 seconds.
Bushell was 0.34 seconds clear of the field as he convincingly claimed Great Britain’s fifth gold medal in the Olympic Stadium.
He was born with seven vertebrae missing from the lower part of the back.
Bushell, whose win took Great Britain’s athletes’ total medal tally to 12, revealed he had been inspired by watching David Weir’s 5,000m victory.
He said: “Gold was the only thing I wanted. I know I had to work for it, it’s been a long, hard four years.
“Last night I watched Dave Weir and as he crossed the line I was bouncing off the walls in my room. I didn’t know what to do.
“He’s been a massive influence – just as a team-mate, he’s been there for me. He was there for me in Beijing as well, even with all the stuff he had to deal with as well.
“He’s a fantastic guy, a great role model to look up to.”
On the race, he said: “It was fantastic. It went a lot better than I thought. The crowd were fantastic, they definitely pushed me on.
“I nearly cried coming through the line.”
Bushell will go for a second gold in the 200m, but admitted this was the title he had been craving, saying: “This is my stronger event. This is the one I wanted.”