Marmelo claimed the lead inside the final furlong of the $7.3 million race but was grabbed late by the fast-finishing Cross Counter who won by a length, with a further two lengths to A Prince Of Arran in third.
The win also represented another first: the breaking of Godolphin and Sheikh Mohammed bin Rashid Al Maktoum's 30-year drought at the race.
Last year Regal Monarch, which fell in race four on Melbourne Cup day, was euthanased after being injured during the race.
The Aidan O'Brien-trained horse suffered a fractured shoulder during Tuesday's race and had to be euthanised, Racing Victoria's executive general manager of integrity services, Jamie Stier, said in a statement.
Cross Counter spent a week sidelined after a cut reduced the gelding to box rest and walking duties overcoming the hiccup.
The Cliffsofmoher's jockey Ryan Moore looks dejected as he walks off the track, while Cross Counter's win in the Melbourne Cup plays on the big screen behind him.
Terrible news. The Cliffsofmoher suffered a fractured right shoulder when injured in the Melbourne Cup, unfortunately could not be saved.
But an abandonment of the 2018 Melbourne Cup meeting is highly unlikely and would only occur if it the health and safety of those involved - not least the horses and jockeys - was called into question.
"I was travelling back from somewhere when I heard about it and my first impression was "oh God", Appleby said.
Victorian stewards were able to avoid calling off the Melbourne Cup mid race - won by Charlie Appleby's Cross Counter - but the Lloyd Williams and Coolmore-owned The Cliffsofmoher could not be saved.
O'Brien's son Joseph, who trained Melbourne Cup victor Rekindling previous year, said The Cliffofmoher's death was "very sad".
"What a thrill, to do it for Sheikh Mohammed and Charlie Appleby.
It's very sad", Joe O'Brien said.
"It is a very special day for us all".
"I did promise (the kids) a swimming pool", McEvoy said. "I'm over the moon". Now in its second year, the world's richest turf race was won for a second straight time by Redzel.
In a field dominated by worldwide runners, Youngstar was the best-placed of the Australian-bred horses, the Chris Waller-trained stayer finishing sixth.
Aidan O'Brien fielded three contenders with Rostropovich faring best in fifth, but the race was overshadowed by a fatal injury sustained by Cliffs Of Moher passing the post for the first time.
McEvoy's win on the 9-1 shot followed his Melbourne Cup triumphs on Almandin in 2016 and Brew in 2000.