The 24-year-old BMC rider finished the tough 31.6km course in San Jose - which finished with a punishing climb - to extend his lead over Michael Rogers (Saxo-Tinkoff) and Cameron Meyer (Orica GreenEdge) to 1:47 and 2:57 respectively after those riders finished fourth and sixth.
"I don't want to count my chickens before they hatch, but I'm ready to win, and I think it's about time. I think now I’m finally mature enough to pull through to the end. I think I’m ready to do it," said Van Garderen, who was last to leave the start ramp.
"The climb up to the finish was hard. There was a couple of little downhills that you could kind of soft-pedal and catch your breath a little bit. But it was really on the gas the whole way.
"It’s incredible. I really couldn’t have asked for a better day."
Van Garderen held his newborn daughter on the winner's podium.
"I knew my wife and my daughter were at the finish, and that gave me a little extra motivation," he added. "It's true what they say, becoming a dad brings out something in you."
Vacansoleil-DCM rider Lieuwe Westra, winner of stage one, was second - a huge 23 seconds down on Van Garderen - with Rohan Dennis (Garmin Sharp) third at 28 seconds.
Saturday sees a 147.1km run from Livermore to Mt. Diablo and the race concludes on Sunday with a 130.4km stage from San Francisco to Santa Rosa.