Diyas, ranked 100th in the world coming into the tournament, overpowered her fellow qualifier and let out a squeal of delight after completing her fairytale Tokyo run with a sliced serve after 78 minutes.
"It was a really tough match," said Diyas, who reached her only previous final in Osaka three years ago. "I had to work for every point."
Diyas, who had wrist surgery last year, added: "It was really tough to come back so I'm really happy to be playing again and to win a title."
Kato's own improbable run to the final was a boost for organisers after the loss of all eight seeds and the early exit of local favourite Kimiko Date in her final tournament at the age of 46.
The Japan Women's Open serves as the amuse-bouche for next week's Pan Pacific Open tournament at the same venue featuring the likes of world number one Karolina Pliskova and Wimbledon champion Garbine Muguruza.
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