Dennis rode the 13.8km opening stage at an average speed of 55.446km/h to take the first yellow jersey of 2015.
The 25-year-old South Australian beat the previous fastest time-trial record of 55.2km/h set by British rider Chris Boardman over a 7.2km course in 1994.
Former holder of the World Hour Record, Dennis powered through the flat course in a time of 14min 56sec.
Tony Martin finshed second, with Swiss veteran Fabian Cancellara third and Dutch favourite Tom Dumoulin in fourth.
Of the general classification favourites, Chris Froome finished 37th, 50-seconds behind Dennis, Alberto Contador was 58-seconds back in 46th and Nairo Quintana was 61-seconds adrift in 53rd spot.
Dennis becomes just the seventh Australian to ever wear the yellow jersey and the first since Simon Gerrans who wore it for two days in 2013.
The only other Aussies to win a Tour de France time-trial are Brad McGee and Cadel Evans.
There were incredible scenes on the course as the Dutch crowd cheered on local hero Dumoulin who rode an hour after Dennis and looked set to better the Australian's time.
Trailing by a second at the only checkpoint on the course, Dumoulin faded badly in the second half, finishing in fourth place, eight seconds behind Dennis.
Here's the end of Dumoulin's race as his time slips by Dennis'.
German time-trial maestro Tony Martin was another major threat, but finished five seconds back
Swiss time-trial specialist Fabian Cancellara was the last legitimate challenger to Dennis' time, but even he couldn't knock the Aussie off.