The Kiwis had entered the final on the back of a sensational win over England but their hopes of winning a second ICC title this year were shattered as Australia cruised to an eight-wicket victory.
David Warner and Mitchell Marsh's splendid fifties sealed the victory over New Zealand.
Williamson provided much need fire to the New Zealand batting order which otherwise had an off day.
While Australia and New Zealand are two contrasting units, both are high on confidence after inspired shows in the semi-final games.
The Kiwis have peaked at the right time here, firing on all cylinders to oust England with a superlative batting show from Daryl Mitchell and Jimmy Neesham in the first semifinal.
The Australian team has come into the T20 World Cup three successive series it played this year in the lead-up to the tournament.
T20 World Cup final: Nitin Menon to be TV umpire; Marais Erasmus, Richard Kettleborough named on-field umpires
Former Sri Lanka spinner Kumar Dharmasena will be the fourth umpire.
The contest will bring back memories of the 2015 50-over final in Melbourne when Australia beat New Zealand to lift their fifth ODI World Cup.
Australia is expected to be without Test players like David Warner, Steve Smith, Pat Cummins and Mitchell Starc, who will be mid-way through a three-match Test series in Pakistan.
Conway sustained the injury when he struck his bat immediately after being dismissed in the semifinal win over England in Abu Dhabi, New Zealand Cricket said in a statement.
Dhoni was handed the job of skipper in 2007 for the inaugural ICC World T20 held in South Africa.