Donald held a one-shot lead heading into the final round in Sun City, but could only manage a closing 73 on the day he turned 37 and finished six shots adrift of fellow Englishman Willett in third place behind Ross Fisher.
World number 84 Willett carded a stunning 65 to move just a shot behind Donald on Saturday and the 27-year-old rose to the occasion with a 66 to finish 18 under par and claim his second European Tour title.
It is two years since Willett landed his first European Tour title when he won the BMW International Open back in 2012 and on the evidence of his display this weekend at the Gary Player Country Club, there should be more to come.
The Sheffield-born right-hander made only one bogey in the tournament and held his nerve when the pressure was on to become the first winner in the 2015 Race to Dubai.
Willett shot the lowest score on Saturday and Sunday, with his six-under round on the final day coming courtesy of three birdies on the front nine and a further three after the turn.
The final leaderboard made good reading for English golf, with Fisher taking second spot with an impressive 68 and wondering what might have been had he not bogeyed the fifth and sixth following two birdies in the first four holes.
Donald's hopes of ending his two-year wait for a victory were hit by bogeys at the third and fifth holes, then another at the 10th before his misery was complete when he dropped another shot on 18.
Willett had finished fourth at the Turkish Open last month after he was seventh at the Portugal Masters in October but he was not to be denied this time around.
German Marcel Siem finished fourth following his 68 on Sunday, while Thailand's Kiradech Aphibarnrat was fifth ahead of veteran Spaniard Miguel Angel Jimenez.