The peloton began to split apart with over nine kilometres remaining, with Chris Froome (Team Sky) the first of the big names to falter and drop off the back.
With Movistar pushing the pace up the front, more and more riders were ejected out the back of the main bunch before Alberto Contador (Tinkoff) put in a strong attack and Quintana jumped straight onto his wheel.
Quintana then attacked decisively with 3.6 kilometres to go, leaving Contador behind before catching and dropping the final breakaway member Robert Gesink (LottoNL-Jumbo) to take both the stage win and reclaim the red jersey.
The Colombian pushed hard all the way to the line to gain precious seconds on his rivals and now holds a lead of just under a minute back to team-mate Alejandro Valverde and Chris Froome.
Froome couldn't follow the early pace on the climb and was distanced, but made a memorable comeback with the help of his team-mates and and a superb personal recovery. He swept up and past all of his rivals; the only one he could not overhaul was Quintana.
Gesink attacked Froome to take second place but Froome limited his losses to just 25 seconds after looking in serious trouble earlier on.
Alberto Contador (Tinkoff) went the other way, from initially being the aggressor to finishing well down as he cracked after Quintana's attack, being caught and passed by Froome and ending up conceding just over a minute to Quintana on the stage.
The Movistar leader now heads the race, leading teammate Alejandro Valverde by 57 seconds, with Froome up to third at 58 seconds. Esteban Chaves (Orica-Bike Exchange) fought hard to finish ahead of Contador and is fourth at two minutes and nine seconds adrift. Contador is fifth, a further 45 seconds adrift at two minutes and 54 seconds disadvantage.
Quintana pulled on the race leader’s jersey on the podium and was happy to be back in charge and back in his normal superior climbing form after a comparitively benign display at the Tour de France.
"I was dreaming of winning on a summit of champions. I checked out the climb beforehand because I knew it was so important," Quintana said after the race.
"I was dreaming of having my name alongside compatriots like Herrera and Rincón, together with other magnificent riders. I’ve always dreamt of winning here, and today I’ve managed to do it
"I felt good. I saw that there weren’t many of us left, then the attacks came and I went with Alberto. I'm very pleased to get the victory here, in what is such an iconic climb.
“Chris remains pretty close for the remainder of the race. We must continue to pick up the pressure, doing the same we’ve done until this point: attacking and attacking to distance him further.
"Should we keep this minute we have when the Calpe TT looms, he’ll be the main favourite. I think three minutes would be a reasonable gap to tackle the time trial with calmness.
"I’ve always have confidence in my ability. At times I’m better, at other times worse. But at the moment I feel better than him and that’s a real boost."
As it happened
With riders fatigued after an intense weekend of racing there was a sense of focus and trying to get through the final day in the mountains before the much needed rest day.
An ugly crash at the 20km mark brought down several riders with Bora-Argon 18's Bartosz Huzarski quickly forced to quit the race due to a suspected fractured collarbone. Markel Irizar (Trek-Segafredo) was another to abandon after suffering nasty face injuries, along with Kevin Reza (FDJ).
Another crash saw Etixx-QuickStep hit, with Gianni Meersman and Niki Terpstra going down. That slowed the peloton as prominent general classification rider Gianluca Brambilla was also caught behind the fall but the speed quickly rose again.
A strong group of 16 riders formed off the front as the race passed near the coast, forcing Etixx-Quickstep to hit the front again to protect De la Cruz's jersey despite their wounded troops after the tumble.
Cannondale-Drapac had the numbers in the move with their riders working especially hard for Pierre Rolland and the gap opened to three minutes. However Etixx-Quickstep found allies for the chase in the form of Movistar, who were happy to set a strong tempo to fatigue the other contenders.
The rolling roads gave way to serious climbs in the final 50km with the category 1 Alto del Mirador del Fito (6.2 km at 7.8%) causing the escapees to break apart.
Luis Angel Maté (Cofidis) and Omar Fraile (Dimension Data) dueled for maximum points at the summit, with the 2015 Vuelta mountains winner emerging jsut the stronger and taking enough points to take the blue polka-dot jersey once again.
As the gradient kicked in on the 12km climb of Lagos de Covadonga, the break had an advantage of two minutes and 45 seconds but quickly blew apart of the lower slopes with a Louis Vervaeke (Lotto Soudal) attack splitting the group.
He was soon caught and Robert Gesink and Rolland responded with their own attacks with the lanky Dutchman eventually getting better than the Frenchman and going clear.
Both were overtaken in the end with Rolland fading to a disappointing 21st on the stage after all the work of his team-mates, whilst Gesink couldn't quite hold off Quintana in the final kilometres, finishing 2nd on the day with breakaway companion Omar Fraile also holding out well for fourth on the day.
