Afghanistan came into the match having lost 16 of their last 17 World Cup games, their only victory coming against Scotland in 2015.
Put into bat, Afghanistan posted 284 after a blistering knock of 80 from opener Rahmanullah Gurbaz and a half-century from Ikram Alikhil.
England crumbled to 215 all out in reply, with Harry Brook the only batter to adapt to the conditions with a fighting 66 as spinners Mujeeb Ur Rahman and Rashid Khan took three wickets each.
Mujeeb picked up the key wickets of Joe Root and Brook to set up a famous win and he picked up the player of the match award.
"Very proud moment to be here in the World Cup and beating the champions, it's a great achievement for the whole region. I'm so happy with this performance," Mujeeb said.
"As spinners it's hard to bowl in the powerplay, but I've been working in the nets to be as consistent as possible... We knew dew would be a factor."
Rashid said he hoped the victory would put a smile on the faces of people back in Afghanistan, where multiple earthquakes have killed around 1000 and injured more than 2000.
OPENING STAND
Afghanistan got off to a flying start with a 114-run opening stand between Gurbaz and Zadran who scored at eight an over in the first powerplay.
Gurbaz brought up his fifty rapidly, but they lost wickets as leg-spinner Adil Rashid (3-42) dismissed Zadran and had Rahmat Shah stumped in his next over.
Gurbaz looked well set for a World Cup century having smashed eight fours and four sixes, but the 21-year-old was run out by substitute David Willey at midwicket when skipper Hashmatullah Shahidi called him for a risky run.
Gurbaz was livid as he trudged off, smashing his bat on the boundary rope on his way back to the pavilion.
Alikhil and Rashid Khan steadied the ship with a 43-run stand, but the latter was dismissed when he looked to clear the long on boundary in Rashid's final over.
Root -- who took four catches -- timed his dive to perfection to take a stunning catch in the deep. Alikhil departed for 58 and Mujeeb made 28 off 16 balls.
"I told the boys that 280-290 was enough on this track as it would assist the spinners," Afghanistan captain Hashmatullah Shahidi said.
EARLY WICKETS
England lost early wickets, Fazalhaq Farooqi trapping Jonny Bairstow lbw and Mujeeb dismissing Root with a quicker ball that kept low and crashed into the stumps.
Dawid Malan made a patient 32 but fell to Mohammad Nabi, giving Zadran a simple catch in the covers, and skipper Jos Buttler was bowled by a peach of a delivery from Naveen-ul-Haq to leave England reeling at 91-4.
Brook stood firm, however, bringing up his half-century in 45 balls with confident strokes, but he was caught behind off to Mujeeb to spark wild celebrations before Rashid cleaned up the tail.
"Disappointing, a tough loss to take. Congratulations to Afghanistan, they outplayed us today. We were not at the level we wanted to be with the ball and the bat," Buttler said.
"Afghanistan have a really skillful attack... They put us under a lot of pressure."
England are fifth in the group standings with one win from three matches, one place ahead of Afghanistan.
