Gavin tarnished Vassell's previously unbeaten record with a clinical display, the Birmingham fighter inflicting a suspected broken jaw on his opponent in the process.
Gavin, who maintained his own 16-0 unbeaten record with victory, added the Commonwealth belt to his British title.
Gavin had Vassell on the back foot from the first bell with some precise punching and, despite a brief fightback from the Mancunian in the fifth, Gavin was in control throughout.
A big shot in the seventh inflicted major damage on Vassell's jaw and after a doctor inspected the blow at the bell, referee Howard Foster called an end to the fight.
On the undercard, Paul Butler beat Najah Ali to defend his Commonwealth super-flyweight title with a fourth-round stoppage, while Liam Smith, Joe Murray and Stephen Smith all also won.