Armstrong, who started last in the 18-mile race, beat out Germany's Judith Arndt by 15.47 seconds, posting a time of 37 minutes, 34.82 seconds. Russia's Olga Zabelinskaya won the bronze.
"This is an amazing moment for me to come back four years later," said Armstrong, after the race. "I read about things like Michael Phelps. But I always feel like I'm the normal one, the normal kid that never was told by their coach that I have anything special. It was just the determination and sacrifice that I had, all the way from when I was in elementary school."
Armstrong, who became the oldest gold medalist in an Olympic cycling road event after Wednesday, also won the women's individual time trial in the 2008 Beijing Games. A year after that, she retired, and then gave birth to her son Lucas in 2010.
In 2011, she made a return to cycling, seeking to find a balance between training and motherhood.
The 38-year-old from Memphis had won three national championships. Now, however, Armstrong plans to retire for good.
"This is it," Armstrong said. "I just kept telling myself out there, my mantra was, 'Kristin, you must live with the result, whatever it is.' Any athlete knows you're only as good as your last ride, and this was my last ride."