Cristiano Ronaldo scored the winning penalty to help Real Madrid win 5-3 in penalties to claim their 11th UEFA Champions League title at the San Siro in Milan on Saturday.
The match was locked at 1-1 after extra time before the match was dragged into a penalty shoot-out.
Real captain Sergio Ramos opened the scoring on 15 minutes before Atletico substitute Yannick Carrasco equalised in the 79th.
Atletico, giving their usual never-say-die performance, conceded an early goal, missed a penalty, clung on by the skin of their teeth and then found the strength to equalise at the San Siro.
But it was all in vain as Juanfran struck their fourth penalty against the post, allowing a previously subdued Ronaldo to stride up and coolly blast home the decisive penalty for a 5-3 shootout win -- his third European Cup success.
Real's former playmaker Zinedine Zidane was left to celebrate winning Europe's elite club competition five months after starting his first coaching job and become the seventh man to claim the trophy as both a player and a manager.
But it was another demoralising end for Diego Simeone's Atletico who were within a minute of winning the 1974 European Cup final and 2014 Champions League finals but conceded equalisers and eventually lost them both.
Real captain Ramos, who converted their fourth penalty, said the title was "just reward" for their hard work. “We knew that it was a unique chance to make history and after an up and down season it is a reward," he said.
Match-winner Ronaldo added: "The penalties are always a lottery, you never know what will happen, but our team showed more experience and we showed it by scoring all the penalties. A fantastic night for us."
Atletico's shattered coach Simeone added: "It hurts to see the people who paid for the tickets and I couldn't give them what they wanted. That hurts more than anything else.
"I'm proud of my players, they've made an extraordinary effort, to beat Barcelona and Bayern Munich (in earlier rounds). The effort was really tremendous."
Atletico started the game frustrated Real and challenged them with rough play.
They showed their intentions with some heavy tackles early on but their plan threatened to unravel when a heavy challenge by Gabi led to a free kick which was floated in by Toni Kroos and headed on by Gareth Bale for Ramos to bundle home.
Real looked supremely confident and there was some premature showboating, but Atletico, initially uncomfortable at having to chase the game, forced their way back into the match.
The second half began dramatically when Pepe clumsily caught Fernando Torres's ankle in the area to give away a penalty but Griezmann fired against the underside of the bar, possibly distracted by Keylor Navas's antics on the goal line.
A breathless spell followed as Atletico, leaving gaps at the back, had a series of dramatic escapes.
Karim Benzema had the chance to settle it for Real when he broke clear down the right but Atletico keeper Jan Oblak judged the situation perfectly and blocked the Frenchman's shot.
Slovenian Oblak also made a superb stop from Cristiano Ronaldo and Stefan Savic cleared Bale's shot off the line.
Atletico did enjoy the bigger share of possession in the second half.
They created more chances and even though Antoine Griezmann fluffed a penalty to go level, it was super-sub Yannick Carrasco who ensured that the match was stretched to extra-time.
In the 79th minute, Juanfran picked out Koke's chip on the right, to cross it to Carrasco outside the box who makes no mistake as he cancels out Real's first-half goal.
That could have been the turning point, but instead Atletico ran out of steam.
The pace of the match slowed and neither side really looked like winning it in extra time, with Ronaldo looking short of full-fitness but with Zidane having already used up his three substitutes.
Real's players looked tired as the match wore on but both teams searched for the winner in extra-time.
In a match that saw near negligible touches from superstar Ronaldo, fears of his fitness began to show in the later stages of the match.
Both teams did their best to take the lead and Real piled on the pressure late in 2nd half of extra-time but it was not be and the match was forced into penalties.
Real won the toss for the penalties and chose the end where their fans were based.
Lucas Vasquez took the first penalty for Real and converted. Greizmann made it count to make it 1-1. Marcelo and Gabi then made it 2-2. The world's most expensive player Gareth Bale then slotted in a left-footer and was matched by Koke.
Sergio Ramos made it 4-3 and the pressure was on Juanfran.
The first seven penalties were all converted until the hapless Juanfran saw his effort hit the post, leaving the way for Ronaldo to win another European title for his side.