Ricciardo, meanwhile, built up a cushion over Bottas to claim an ultimately comfortable victory, with Kimi Raikkonen taking third having earlier looked out of podium contention and Hamilton fourth.
The four-time world champion has always professed his love for F1's most famous team - Ferrari - and if they are on course to return to the top of the sport and with Vettel's teammate Kimi Raikkonen out of contract at the end of the season, there could be possibility of the British driver making the switch over to the Maranello based team.
Vettel, who finished second in Shanghai previous year, has five career podium finishes at this race but his only win came all the way back in 2009, so don't be surprised if Hamilton and Mercedes get back to their winning ways this weekend. "I just need to analyse everything and come back stronger for the next race".
Vettel said that Verstappen was past the point where the Dutchman's relative inexperience could be seen as an excuse.
"I didn't have to fight so much finding the last fine tunings".
"The whole weekend we were just not good enough", Wolff said.
Vettel, who already holds a 17-point lead over Hamilton with victories at the opening two Global Positioning System, saw off Raikkonen's challenge to edge out the Finn with a dramatic last lap.
And while Ferrari will have been more than happy to feed off their rivals' misfortune, with wins for Vettel in the two opening rounds, their qualifying performance in Shanghai put daylight between the teams.
"The amusing bit of being outperformed on Saturday is that you are the lion that's just waiting to jump on the prey", commented Mercedes team boss Toto Wolff.
Red Bull racing were again solid in their qualifying with the young Dutch sensation Max Verstappen will start from the third grid qualifying P5 while his teammate Daniel Ricciardo will be alongside him in P6.
Mechanics were seen frantically snapping major pieces of the car's body back into place as the clock ticked down, and the Australian driver tore out onto the track with only about a minute to spare.
"I need to learn from what happened today. We definitely were not doing that for the cameras", said a clearly relieved Ricciardo. "That will be fun".
It wasn't the only mistake Verstappen made during the race. But I think that the forecast is for quite some different temperatures, some 20ºC [68F] hotter track temperature.
"Obviously I wouldn't mind if it stays there, but I think it will be a tight race amongst the top three teams, and a long, tough race, but obviously it's good to start from the front".
The second Renault of Carlos Sainz was ninth, with Kevin Magnussen completing the points scoring places in 10th place for Haas.