The ever-cool Finn, living up to his nickname of the 'Iceman', romped home a massive 39.2 seconds ahead of Ferrari's Brazilian Rubens Barrichello on Sunday.
With new rules mixing up the grid, but none of the unpredictable weather of the enthralling Australian opener, the 2003 season continued to provide thrills and spills in abundance.
In a race turned topsy-turvy by Schumacher colliding with Italian Jarno Trulli into the second corner, Renault's promising young Spaniard Fernando Alonso claimed his first podium with third place.
Already the youngest ever pole starter, the 21-year-old became the first Spaniard on the podium since Alfonso de Portago was second at Silverstone in 1956 for Ferrari.
Raikkonen's win, in searing heat and under blue skies, had been seen coming for some time and was a deserved reward for the disappointment of missing out on a season-opening win in Australia two weeks ago.
CHAIN REACTION
It lifted the 23-year-old to the top of the championship after two races with 16 points, ahead of team mate David Coulthard on 10. Five-times world champion Schumacher nudged the rear of Trulli's Renault in an incident that triggered a chain reaction behind him and produced a drive-through
The German -- his fourth place in Australia two weeks ago was the first time he had finished off the podium since Monza in September 2001 -- carved back through the field but was a lap down on Raikkonen before the halfway mark.
He finished sixth after four visits to the pits, one for the penalty and another to replace his front wing.
With some familiar frontrunners out of the running, the second race of the season was blown wide open with some immediate surprises.
Germany's Ralf Schumacher, winner in Malaysia for Williams last year but apparently out of the running after qualifying 17th, experienced a sporting resurrection to claim fourth place ahead of Trulli.
Briton Jenson Button was seventh for BAR and Germany's Nick Heidfeld eighth for Sauber.
Button's Canadian team mate and feuding foe Jacques Villeneuve failed to start, a situation that undermined his much-publicised opinion before the race that Button was a weak team mate.
Coulthard, winner in Australia, fell by the wayside on lap three with an apparent mechanical problem and Colombian Juan Pablo Montoya found himself running around at the rear after being caught up in the first lap mayhem.