The 26-year-old Spaniard, who was winning for the third time this season following his victories in the Qatar and Italian Grand Prix', moved from third on the grid to first on his Yamaha before the first corner and was never overtaken.
Pedrosa meanwhile extended his run of podium finishes to five races as he held off a late charge from his Honda teammate Marc Marquez to finish second with the rookie back in third.
Lorenzo, who has hit back strongly in the title race having won the last two races with Pedrosa having won the previous two, said that it had been hell riding in the race.
"I knew that the start would be crucial and I couldn't afford to let Dani get away from me," said Lorenzo, who also won the world title in 2010.
"I got lucky and actually passed him and although he pressured me for a while he let up at halfway and I was able to relax a bit. It was a nightmare race to ride in because of the temperature."
Lorenzo revealed touchingly that the special designed helmet — it was designed by a friend of his who suffers from Downs Syndrome — he had worn for the race would now be offered up for sale.
Pedrosa was not too disappointed at the end result even if it saw his lead reduced in a category he has yet to emerge from victorious having finished runner-up in the world championship three times.
"I had to ride a defensive race for most of it as Marc (Marquez) was really attacking me," said the 27-year-old.
"It was not a perfect race for me as I was never close enough to Jorge to pass him. It's not a good feeling from this race but still I am relieved to be in the overall lead."
Marquez, who earlier this season became at 20 the youngest ever winner of a race in the category when he won the Grand Prix of the Americas, said that
Pedrosa had done a skillful job in fending him off.
"As I prepared to attack Dani he braked early and that forced me to as well which cost me valuable time," he said.
"I pushed 100% on the last lap and really made back that ground but he held on and I can only be happy with finishing on the podium."
In another day of baking hot conditions at the Montmelo track the majority of the action arrived very early in the race as Lorenzo got alongside Pedrosa on their way into the first corner and almost collided with him before slipping down the inside of the Honda rider to move into the lead.
Marquez also had a great start as he jumped from sixth on the grid to third by the first corner as he passed Cal Crutchlow, Alvaro Bautista and Nicky Hayden.
However, worse was to come for all three of those riders as with many of the field struggling for grip on the sweltering track, they crashed out with barely two laps of the race completed.
That left the path clear for six-time world champion Valentino Rossi to move up to fourth, but the Italian never threatened to catch the Spanish trio at the front who began to build up a comfortable advantage.
Pedrosa stayed on Lorenzo's backwheel for the first-half of the race but the world champion managed to pull away slightly in the closing laps to ensure his position was never under any threat.
The focus then turned to a fascinating battle for second as Marquez showed little respect for the seniority of his teammate Pedrosa as he chased down the championship leader in the final stages with the two almost touching wheels at one point.
However, Pedrosa held on to move onto 123 points with six of the 18-race long campaign gone, whilst Lorenzo moves onto 116 and Marquez, remarkably in his first season in MotoGP, strengthens his position in third ahead of Crutchlow with 93 points.