Baxter mastered the windy conditions to win the 10,000m title in 34min 17.58sec from Chris Tipper (Ariki) in 35min 01.18sec and Neale McLanachan (Leith) in 35min 30.86sec.
He won his first title at the Otago cross-country championships at Waikouaiti in July.
Baxter (22), who recently graduated in physical education at the University of Otago, has not been able to train for a month after suffering an infected ankle during a physical education camp at Paradise near Glenorchy.
"I was not in the best shape and moved slowly into the race," Baxter said.
"I did not have great expectations and am happy with the result."
The win was important to Baxter's future in the sport.
"I've motivated myself to get back into full training," Baxter said.
"It has kick-started me."
But he was almost upset by club-mate Chris Tipper (20) who ran above expectations to finish second, 43 seconds behind Baxter.
Tipper has only been running competitively for three years but has made steady progress under the coaching direction of Alan Moir.
He has been given a regular dose of Arthur Lydiard-style training by running 150km each week.
Over the past two months he has made significant breakthroughs.
He was fourth in the senior men's race at the New Zealand half-marathon championships in Auckland and confirmed his form on Saturday.
In the same race last year he finished ninth.
Tipper was the pacemaker and broke up the bunch of four with a strong burst with the wind at his back on the 11th of the 25 laps.
Tipper kept bursting down the front straight for the next eight laps and McLanachan was dropped two laps later.
But he was not able to break Baxter.
"I was surprised to find myself still in the race," Tipper said.
"I was bewildered to find myself doing so well.
"Baxter finally made his move with six laps to go when he burst away down the back straight and had a seven-second lead over Tipper at the end of the lap.
He continued to apply the pressure and the gap stretched over the final five laps before he won by 43 seconds.
International Shireen Crumpton (Hill City) led from the start to retain the women's title in 37min 40.52sec.
Julie Wilson (Ariki) won the masters women's title in 39min 43.20sec.
It was an Otago record in the 50 to 54 age-group.
It broke Dalise Sanderson's (Taieri) 2005 record by 1min 56sec, an impressive effort in the windy conditions.
Twelve-year-old Rosie Craven (Hill City) broke the Otago girls aged-13 pole vault record by 5cm and equalled the record standard for a 14-year-old with a leap of 2.20m.
It was a personal-best jump by 5cm.
Richard Kinley (42) showed that he still has the speed to match the youngsters when he won the men's 100m (13.41sec) and 200m (26.51sec) double.
Hill City's Lauren Wilson (17), who won two bronze medals at the national secondary schools athletics championships at Timaru, won the women's sprint double in the 100m (13.17sec) and 200m (26.54sec).
Nicole Bradley (Caversham), another bronze medallist in Timaru, won the women's 19 and under shot put with 10.92m.
Hannah Blair (Taieri), who won a silver medal at last year's New Zealand's championships, won the women's javelin with a throw of 44.79m.
New Zealand representative Jerram Huston (Taieri) won the men's shot put with a promising pre-Christmas put of 13.82m.
Graham Helm (Ariki) sprinted down the straight to win the masters men's 800m from Alex McEwan (Hill City) and Russell Lund (Ariki) in 2min 17.77sec.
