The Spanish world champion beat compatriot and Honda pilot Pedrosa to the first corner and pulled away in the latter stages to win by just under two seconds, his second consecutive win at the Montmelo circuit near Barcelona.
Rookie Marc Marquez completed an all-Spanish podium when he finished just behind Pedrosa in third after pushing his team mate hard on the final laps.
A host of riders including Britain's Cal Crutchlow, Spaniard Alvaro Bautista and American Nicky Hayden crashed out leaving former world champion Valentino Rossi of Italy to coast home in fourth.
"Right from the first corner we were having huge problems with the front tyre but I imagine all the riders were as the temperature was horrible," Lorenzo said in an interview with Spanish television broadcaster Telecinco.
"It was extremely hot and the tyres lost a lot of performance but as I said the start was crucial and I got a better start than I expected and was able to get past Dani at the first corner," he added.
"It was a bit like cat and mouse but towards the end I was able to push a bit harder and I was able to win such a tough and physically challenging race."
It was a faultless performance from Lorenzo, who also beat local hero Pedrosa into second in Catalunya last year, and the 26-year-old Majorcan has 116 points after six of 18 races.
Pedrosa leads on 123 points with Marquez third on 93 and Crutchlow fourth on 71.
"At the beginning it was reasonably comfortable with a decent rhythm but then the tyres started to deteriorate and the three of us slowed down," Pedrosa told Telecinco.
"I was never able to get to the straight right behind Jorge to attempt a pass," added the 27-year-old.
"It was an easy day to fall and I wanted to push him (Lorenzo) but I knew that I couldn't make any mistakes."
In the Moto2 category, Spaniard Pol Espargaro secured his second win of the year ahead of compatriot Esteve Rabat in second, Swiss Thomas Luethi in third and championship leader Scott Redding of Britain in fourth.
Luis Salom moved to the top of the Moto3 standings with his third victory of the year with Alex Rins and Maverick Vinales in second and third respectively as Spaniards filled the top five places.
The riders now head to Assen, Netherlands for the next races at the end of this month.
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