The race was red flagged after two laps when Carlos Sainz crashed out as wet weather wreaked havoc on the Suzuka circuit.
Verstappen dominated out in front once the race resumed, but it initially appeared he would have to wait to wrap up the world title at the US Grand Prix after Charles Leclerc crossed the finish line second and Sergio Perez was third.
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But in a late twist, Leclerc was handed a five-second time penalty for leaving the track and gaining an unfair advantage on Perez during their tight duel in the dying stages.
Even so, many believed Verstappen had not yet attained an unassailable lead in the championship and the full complement of points wouldn't be awarded because less than 75 per cent of the race had been completed.
But officials deemed because the race resumed after a red flag and it went to the end of the three-hour window, it was decided the race had been completed and full points would be awarded.
F1 fans were still crunching the numbers and they had their heart in their mouths when Sky Sports presenter Johnny Herbert told Verstappen he had wrapped up the world title in a post-race interview.
Verstappen was unsure if he had in fact sealed the championship, prompting bizarre scenes in the cool down room when he had to clarify what had happened with an official.
He said in the awkward exchange: "But I'm not, no? I am? You sure? Because people keep telling me different."
F1 fans were stunned by the farcical scenes, arguing it was the most underwhelming way possible to crown Verstappen world champion.
The Times' Rebecca Clancy tweeted: "Turns out Verstappen is champion today. Congratulations to him. But total farce today. Bad day for the sport."
F1 broadcaster Jennie Gow said: "So full points were awarded - which means Max is CHAMPION. What a weird set of rules."
It means Verstappen's back-to-back world championship wins have both been overshadowed by rulebook technicalities, following the infamous season decider in Abu Dhabi last year when he overtook Lewis Hamilton on the final lap.
The victory in Japan was Verstappen's 12th Grand Prix victory of the season with four races remaining.
He now becomes just the eighth driver in history to consecutive F1 world championships.
Earlier, Pierre Gasly was furious after he narrowly avoided a disastrous collision when a recovery tractor came onto the track too early during the Safety Car period.
Australia's Daniel Ricciardo finished out of the points in 11th, the same position he started in.
Japanese Grand Prix results (top 10)
1. Max Verstappen (Red Bull)
2. Sergio Perez (Red Bull)
3. Charles Leclerc (Ferrari)
4. Esteban Ocon (Alpine)
5. Lewis Hamilton (Mercedes)
6. Sebastian Vettel (Aston Martin)
7. Fernando Alonso (Alpine)
8. George Russell (Mercedes)
9. Nicholas Latifi (Williams)
10. Lando Norris (McLaren)
Updates
After the race resumed, it became clear intermediate tyres were the preferred option over extreme wet weather tyres.
Max Verstappen still has a narrow lead over Charles Leclerc but it's all happening behind them.
Once the frontrunners pitted, at one stage Fernando Alonso was leading the race ahead of Daniel Ricciardo in P2 and Mick Schumacher in P3.
But Alonso and Ricciardo pitted for intermediates and Schumacher was chewed up by the leaders.
Ricciardo is now in 14th and will need to work some magic and hope for a Safety Car if he is to finish in the points.
The tractor saga is just going from bad to worse.
New footage has surfaced of a marshal inexplicably standing on the track attending to Carlos Sainz's beached Ferrari.
The marshal had to quickly step out of the way as Pierre Gasly zoomed past.
The race is set to finally resume at 6.15pm (AEDT) after the rain eased somehwat.
Pierre Gasly has now been summoned to the stewards after the race for a supposed "breach" of the FIA code.
The stewards said there was an "alleged breach of Article 57.2 of the FIA Formula One Sporting Regulations – Speeding under Red Flag Conditions."
"Car 10 reached speeds of up to 250 km/h when completing the lap under the red flag after passing the scene of the incident," the statement said.
The red flag was shown just as Gasly approached the stationary tractor on track, but the Frenchman has come under fire for speeding on the rest of the lap once he had passed the tractor.
F1 fans can't believe race organisers are asking Gasly to justify himself when the FIA was at fault and should never allowed the tractor out so soon.
FIA's International Sporting Code is clear: "No marshal or vehicle shall enter the circuit perimeter without permission from race control."
It's safe to say the FIA isn't helping themselves and won't come away looking too good from this saga.
Footage has emerged of Carlos Sainz spinning out of control into the barriers when his Ferrari aqua-planed on the opening lap.
The on-board view from Daniel Ricciardo's McLaren of the stray tractor on the circuit also makes for scary viewing.
The FIA had this to say in response to Gasly's near miss with the tractor, appearing to blame the Frenchman for driving too fast in an effort to catch to the field ahead of him.
"In relation to the recovery of the incident on Lap 3, the Safety Car had been deployed and the race neutralised," F1's governing body said in a statement.
"Car 10 (Gasly), which had collected damage and pitted behind the Safety Car, was then driving at high speed to catch up to the field.
"As conditions were deteriorating, the Red Flag was shown before Car 10 passed the location of the incident where it had been damaged the previous lap."
It's emerged the tractor was in fact already out on the track when race leader Max Verstappen was behind the Safety Car on his way back to the pits.
F1 commentators couldn't understand why the recovery vehicle came out on to the circuit so early and unnecessarily put the drivers in danger.
"We don't want to see any vehicles on the track in conditions like this when Formula 1 cars are out on track too," Sky Sports' David Croft said.
Ted Kravitz said the incident had "shades of that fateful race in 2014 with Jules Bianchi".
"No doubt all the drivers are going to want some serious discussions to be going on given what happened to Jules Bianchi here, as to how that was allowed to happen," he said.
Bianchi's father posted on Instagram: "No respect for the life of the driver no respect for Jules memory."
“No respect for the life of the driver no respect for Jules memory”
Lando Norris and Sergio Perez were filthy about the incident, referencing Bianchi's death in 2015 months after his collision.
Carlos Sainz said: "I still don’t know why in these conditions we keep risking having a tractor on-track, because it’s just worthless. If you’re going to red flag it anyway, why risk it?"
Pierre Gasly has let rip over team radio after he had a near-miss with a tractor that was inexplicably on the left hand side of the track just as the race was being red flagged.
He started in the pit lane and the recovery vehicle should have waited for the entire field to come behind the Safety Car before entering the track to attend to Carlos Sainz's Ferrari.
Gasly fumed: "What is this? What is this tractor on track?! I passed next to it. This unacceptable. Remember what has happened. Can't believe this."
"I could have f****** killed myself."
F1 journalist Hazel Southwell tweeted: "This is so unacceptable. Not tractors in gravel traps, they were on the racing line, on the track, barely lights on – we know the stakes, here of all places. Deserves an investigation. this just can't ever happen."
Reporter Chris Medland said: "How that was allowed to happen at this track of all places is just absolutely ridiculous. Gasly was always going to be trying to catch back up with the pack before it was red-flagged."
It was an unacceptable error in the wet weather and poor visibility, especially considering Jules Bianchi died at the Japanese Grand Prix when he collided with a recovery vehicle in similar conditions.
It's light out and what a chaotic start to the Grand Prix that was.
Max Verstappen was slow off the mark but managed to keep Charles Leclerc at bay and maintain the lead through the first corner.
But it was disaster for Carlos Sainz, who crashed into the wall, ending his race early.
Alex Albon is also out of the race after his Williams failed to get out of gear.
Amid the chaos, some advertising hoarding somehow became perched on the front wing of Pierre Gasly's AlphaTauri.
Daniel Ricciardo made a great start, moving from 11th up to P8, while his McLaren teammate Lando Norris slid from 10th down to 13th.
The race has been red flagged for now and there's hope the rain will ease or stop so the Grand Prix can get back underway.
The FIA said: "Red Flag due to worsening weather conditions and recovery operations required on track. Restart time will be confirmed by Race Control."
AlphaTauri's Pierre Gasly will start from the pit lane as a result of changing his rear wing and front wing ballast to a different specification to what he had when he started qualifying.
The rain is continuing to fall at Suzuka and there could even be a rare rolling start in the wet conditions.
The heavens have opened up an hour away from lights out and it could lead to an interesting start to the race.
Formula 1 journalist Chris Medland tweeted the FIA is looking into the possibility of a rolling start and how it would work if the rain gets heavier before the race start.
"With rain coming in, the FIA has issued a clarification of how it will interpret wording if it needs to implement a rolling start. The grid is downhill here and could be uneven in terms of wet / dry, or it could rain heavily, but it’s not a commitment to a rolling start yet," he wrote.
