Yule, whose six previous World Cup wins have all come in slalom, was the last qualifier for the second run, having finished a mere 0.05 seconds ahead of Fabien Ax Swartz.
"I'd already packed my bags and I was ready to go back to the hotel but then I got an opportunity to ski the second run," said Yule after the race.
"I thought, 'OK, it's warm weather, you have a perfect track,' so we can maybe go and fight for a top 10 or something, but I never dreamt about the win."
His 30th position meant Yule was first out of the gate in the second run and as the piste at Les Houches worsened, he had the best of the conditions.
"It was warm when the sun came out, the slope suffered a bit more in the second run," said Yule.
"I was definitely lucky but also I took my chance. In a career sometimes you get lucky, other times I've been on the unlucky side.
"Today I really seized my opportunity and I'm glad it worked out like I did."
His run of 47.22 seconds was over half a second faster than anyone else and gave him a combined time of one minute and 36.24 seconds which was 0.16 seconds quicker than fellow Swiss Loic Meillard, who had been fifth-fastest on the first run.
"Absolutely incredible. I got really lucky staying 30th after the first run but then I managed to ski an amazing second run," said Yule whose performance eclipsed the previous slalom record when Lucas Braathen came from 29th to win in Wengen two years ago.
'Bumpy'
Olympic champion Clement Noel, still looking for his first victory of the season, produced a fine first run to top the leaderboard at halfway but the Frenchman produced the third-slowest second run, over two seconds off Yule, to finish third, 0.18 seconds behind the winner on combined times.
"It was really difficult at the end, it was really, really bumpy," said a disappointed Noel.
"But I think I had the chance to win this race.
"I was really close, but that's how it is. I have to take this podium because it's still a really good race from my side."
The Austrian Manuel Feller finished fourth and still leads the discipline standings, 164 points ahead of the German Linus Strasser, who had to settle for equal 14th.
The Chamonix slalom is the only race on the weekend's programme, as the two runs scheduled for Friday and Saturday were cancelled because of a winter thaw, making it impossible to hold a downhill in good conditions.
The women, who were due to ski at Garmisch in Germany, were also unable to compete for the same reasons.
The men's World Cup continues on Saturday in Bankso, Bulgaria, where a giant and a slalom are on the programme.
