The 17-time Grand Slam winner had blown away world number one Novak Djokovic in the semi-finals but he found a stubborn opponent in Simon at Shanghai’s QiZhong Tennis Centre.
And the 33-year-old needed two tie-breaks before dousing Simon to making it back-to-back Masters victories following his win in Cincinnati in August.
The Swiss veteran started poorly against 29th-ranked Simon’s confrontational baseline play and he lost his serve in the very first game.
Federer changed tactics midway through the first set, tentatively approaching the net in a bid to regain the initiative.
But Simon was unfazed, slamming his shots with power when Federer was in a forward position and forcing him to reconsider the tactic.
Shouts of “Come on Roger” were being drowned out by “Allez Gilles!” as the crowd sensed an upset could be on the cards.
But as Simon served for the set at 5-4, Federer broke back and he was in the ascendancy as he earned two break points in Simon’s next service game.
However, he lost the first by dragging his shot too far to his opponent’s right, and the second when Simon bravely met him at the net. Simon then forced the tie-break with an ace.
The pair were evenly matched during a tight tie-break, but Simon finally lost the set as he attempted a serve-volley, allowing Federer pick out a gap to his right.
The players fought to a stalemate in the second set, but Federer’s experience showed as he took a firm grip on the decisive tie-break to win it 7-2 as Simon netted a return.
Federer will now celebrate his 23rd Masters victory as he moves up one place to world number two, displacing Rafael Nadal, in the new rankings released next week.
His previous best showing at the Masters 1000 event was as runner up in 2010, although he did win in Shanghai when it hosted the Tennis Masters Cup in 2006 and 2007.
Meanwhile Simon will return to the top 20 on the back of reaching only his second Masters final, and his first in six years after losing to Andy Madrid at Madrid in 2008.-AFP