A thrilling encounter ebbed and flowed from the opening whistle as Rhys Patchell struck a superb long range penalty to open the scoring for Blues while Jonny Wilkinson responded in an electric opening 20 minutes of European rugby.
Torrential rain hit Cardiff midway through the half and the game continued to flow from end to end with Wilkinson nudging the French side ahead before Leigh Halfpenny made sure the teams went into the break level at 6-6.
Wilkinson edged Toulon further ahead while Blues refused to go away as the game entered a thrilling final ten minutes all square.
The defining moment came three minutes from time when replacement Gareth Davies dived over to lift the roof off the Arms Park.
A tense final few minutes saw Blues hold out and the final whistle was met with scenes of sheer jubilation and delight as the hosts claimed the most dramatic of victories.
A huge crowd descended on the Arms Park for the clash as the champions arrived in town and Patchell got the game underway to a thundering ovation.
Wilkinson showed his kicking range with two thumping clearing kicks as he traded possession with Halfpenny as both sides looked for territory in the opening minutes.
Blues disrupted Toulon on the floor as they looked to go wide and won a penalty as Owen Williams wrapped up his man. Patchell pointed to the posts from inside his own half and produced a brilliant kick to open the scoring.
Patchell was getting some huge distance on his clearing kicks with another epic boot forcing Toulon back and firing up the pumped up Arms Park crowd.
A rare knock on from Halfpenny gave the French side an attacking platform, but Toulon were penalised for feeding at the scrum to ironic cheers from the home support.
Visiting full back Delon Armitage was next to knock on, under huge pressure as Patchell bombed high in the wet skies. A free kick at scrum time gave Robin Copeland the chance to take a tap and go but he knocked the slippery ball on.
The game was hurtling from end-to-end as Steffon Armitage picked off Matt Giteau’s pass to break down the middle.
A grubber kick in behind was tidied up by Filo Paulo and Lloyd Williams before a hack ahead saw Harry Robinson eager to apply pressure on the retreating Armitage.
Blues were next to threaten from deep as Robinson showed his pace to break clear of tackles in midfield and fed Williams on his right shoulder as the Arms Park came alive.
Lloyd Williams produced a superb box kick under pressure, as Toulon hacked ahead into space, while Blues were dealt a potential blow when Cuthbert was left in some discomfort after a big tackle from two French players.
Toulon looked to strike the first blow as they went wide at real pace and exploited an overlap.
Wing Josua Tuisovabroke away and fed a pass inside to Steffon Armitage who hacked ahead. Tuisova then won the resulting foot race to touch down, but after a lengthy consultation with the TMO the try was ruled out for a forward pass in the build-up.
A penalty at the next scrum gave Wilkinson the chance to drew the sides level and the England legend made no mistake from in front of the posts.
Copeland produced a brilliant run down to blow Toulon wide open and kicked ahead to force Wilkinson to hurriedly clear. Frederic Michalak then spilled a low kick from Patchell as the wet weather caused both teams issues.
Lock Paulo was penalised for a tackle on Jean-Charles Oriolo, when the hooker looked to be obstructing the hit on the Toulon runner. Referee Doyle, though, handed Wilkinson another kick and the fly half duly drilled home the penalty.
Patchell showed all his rugby skills to mop up a dangerous high up and under as Toulon started to try and take control of possession and territory as the half wore on.
The rain was now thumping down in the Welsh capital causing handling errors as Delon Armitage looked to chip ahead but he spilled under pressure for the loose ball from Robinson.
Blues were awarded a penalty, after Bakkies Botha was hit for a high tackle on Josh Navidi at the breakdown, and this time Halfpennny lined up a huge kick. But the full back saw his effort just drift wide left of the target.
Patchell then saw an ambitious drop goal fly off target before another penalty against Toulon, for side entry at the ruck, allowed Halfpenny to nudge a kick over from 40-metres to level the scores a minute from the break.
The mistakes were spreading as Wilkinson made a rare error, as he kicked out on the full from the restart, as Blues took the game to half-time at 6-6 to a rapturous ovation from the fired-up home support.
Toulon changed their props row at the break while Blues were also forced into a replacment as Richard Smith replaced Cuthbert.
The French side looked to apply the early pressure as Giteau kicked to the corner after Blues were penalised at the breakdown. And another quick-fire penalty at the lineout saw Wilkinson drill over his third kick of the afternoon.
Blues looked to respond with Cory Allen stepping inside two tackles to run into visiting territory. Ali Williams was then penalised at the lineout and the home side went to the corner to try and force errors.
The rain was getting worse and the penalty count hurt Blues as they lost out at the breakdown and Wilkinson again pointed to the posts from near the halfway. However, the fly half blotted his copybook as his kick missed right.
A massive Toulon scrum forced Blues back in the shadow of their own posts, after a handling error from the home side. And this time there was no mistake from Wilkinson as he put the French giants six points clear.
Delon Armitage kicked way too long from inside his own 22 to hand Blues a strong attacking platform. A penalty at scrum time against Toulon this time allowed Halfpenny to eat into the lead as the sun finally returned to Cardiff.
Wilkinson saw a penalty kick pull up short of the target while Blues injected some pace and won a shot of their own from Patchell that also failed to find its way over.
Another penalty for Blues, this time as Toulon deliberately flicked the ball out of play, gave Halfpenny the chance to bring the teams level again with 12 minutes left.
Tuisova broke down the right and got away from a tackle before kicking in behind. The ball flew out on the full but the penalty was harshly awarded against Halfpenny for no arms in the tackle.
The decision infuriated the home support, but Wilkinson was not in charitable mood as he drilled over the controversially awarded kick for the lead amid jeers.
One last big effort from Blues saw them win a scrum as Maxime Mermoz knocked on. Allen broke into space as the crowd roared the home side on. A brilliant step from Davies then saw the roof come off the Arms Park as he ploughed over for a 19-15 lead.
A tense final few minutes saw Blues run the clock down until five seconds from time when Toulon reclaimed the ball.
Drama saw the French side go left and right to try and force a winning score before a penalty to the home side sparked a thunderous ovation as Blues celebrated the biggest of wins!
04m Patchell p 3-0
21m Wilkinson p 3-3
28m Wilkinson p 3-6
39m Halfpenny p 6-6
45m Wilkinson p 6-9
55m Wilkinson p 6-12
60m Halfpenny p 9-12
69m Halfpenny p 12-12
72m Wilkinson p 12-15
77m Davies t Halfpenny c 19-15
Cardiff Blues: 15 Leigh Halfpenny, 14 Alex Cuthbert (Williams 40), 13 Owen Williams, 12 Cory Allen, 11 Harry Robinson, 10 Rhys Patchell (Davies 73), 9 Lloyd Williams; 1 Gethin Jenkins, 2 Marc Breeze (Dacey 76), 3 Scott Andrews (Bourrust 60), 4 Bradley Davies, 5 Filo Paulo (Reed 76), 6 Josh Navidi, 7 Sam Warburton, 8 Robin Copeland.
Replacements: 16 Kristian Dacey, 17 Sam Hobbs, 18 Benoit Bourrust, 19 Lou Reed, 20 Rory Watts-Jones, 21 Lewis Jones, 22 Gareth Davies, 23 Richard Smith
Toulon: 15 Delon Armitage, 14 Josua Tuisova, 13 Maxime Mermoz, 12 Matthew Giteau, 11 Rudi Wolf, 10 Jonny Wilkinson, 9 Frederic Michalak; 1 Xavier Chiocci (Felsina 40), 2 Jean-Charles Oriolo, 3 Martin Castrogiovanni (Hayman 40), 4 Bakkies Botha (Suta 47), 5 Ali Williams, 6 Juan Fernandez Lobbe, 7 Steffon Armitage (Smith 70), 8 Chris Masoe.
Replacements: 16 Benjamin Noirot, 17 Emmanuel Felsina, 18 Carl Hayman, 19 Juan Smith, 20 Virgile Bruni, 21 Drew Mitchell, 22 Alexis Palisson, 23 Jocelino Suta