Sinner secured the victory with a 7-6 (4) 7-5 scoreline, extending his impressive 31-match winning streak on indoor hard courts.
The match included a medical pause for a spectator and Alcaraz receiving treatment for a hamstring injury, potentially jeopardising his Davis Cup participation.
In the doubles final, Henry Patten and his Finnish partner Harri Heliovaara claimed their first ATP Finals title.
Patten and Heliovaara triumphed over the all-British pair Joe Salisbury and Neal Skupski 7-5 6-3, marking a significant week for Patten who also got engaged.