The Tinkoff rider passed 2013 winner Cavendish in the last 20metres to take the national championship jersey.
It is the biggest win of Blythe’s career, one that has been spent as part of world tour teams in three of the last four seasons after spells with BMC and Orica GreenEdge before joining a Tinkoff team led by Alberto Contador..
Blythe joins Cavendish as the only other non-Team Sky rider to win the event since the World Tour team first took part in 2009.
Sky only entered two riders in this year’s 207km race, with Andy Fenn finishing third to keep the team’s run of podiums going.
Reigning champion Peter Kennaugh and Team Sky team-mates Ben Swift of Rotherham, Ian Stannard and Luke Rowe all missed the event.
Kennaugh has a broken collarbone, but has been named in Great Britain’s squad for the Rio Olympics, Swift has a knee problem and Stannard and Rowe decided to sit the race out ahead of the start of the Tour de France on Saturday.
Cavendish opted against missing the race as he bids for the yellow jersey on stage one of the Tour – as well as Olympic gold on the track in Rio – but he was unable to hold off the 26-year-old from Sheffield in the finishing straight.
Cavendish had worked hard to catch a breakaway with just under three laps left of the main circuit, before the new lead group splintered with Team Sky’s Alex Peters, Axeon’s Tao Geoghegan Hart, Keighley’s Tom Moses (JLT Condor) and Blythe going clear.
Their lead reached 80 seconds but they were eventually reeled in on the penultimate lap of the 4.2-mile finishing circuit, with 12 riders competing in the sprint.
Cavendish came out of the last corner third, with Blythe on his wheel, and it was the Tinkoff rider who took victory, while Fenn took the photo finish for third.
Blythe said: “I wanted that one. I was all day thinking about it, always trying to be in the right move.
“With a couple of laps to go I thought we might hold off the chasers but it came back together. Luckily I got round Cav (in the sprint).”
On managing to beat a rider with 26 Tour de France stage victories, Blythe added: “I think it’s just different. Normally when Cav wins he has a lead-out train and today it was a hard day.
“We weren’t really given any room as such, were always on the pedals and I’ve had one of the highest power (outputs) I’ve had all year so I’m happy and I think Mark’s happy for me...sort of!”
Hannah Barnes edged sister Alice to become British women’s road race champion in Stockton.
Hannah Barnes - who only returned from a six-month injury absence in April - took the sprint ahead of her sibling, whose second place was enough to retain her under-23 title.
Lucy Garner took bronze as a 13-strong group contested the finish after staying clear of the peloton.
Dame Sarah Storey led a solo breakaway and, after being caught and initially dropped by 12 riders, managed to claw her way into the leading group for the finish.
Reigning champion Lizzie Armitstead, of Otley, pulled out on the morning of the race, reportedly due to an illness.
She wrote on Twitter: “Congratulations @bannahharnes a very worthy National Champion. Very disappointed not to race myself but I will be back next year.”
Sir Bradley Wiggins says a record-breaking eighth Olympic medal will mean nothing unless it is gold in Rio, and admits his fear of retirement is tempting him to seriously consider extending his career in search of even more glory.
It has been widely assumed the 36-year-old Wiggins will step aside after this summer’s team pursuit, in which a medal will take Wiggins above his former team-mate Sir Chris Hoy and make him the most successful British Olympian of all time.
But heading into his fifth Games, Wiggins believes he is still fit and focused enough to put a decision on hold.
Wiggins said: “The last 12 months have been my most enjoyable since 2009 and I have really stepped up my performance. I’m a better athlete than I was 16 or even eight years ago, and the way I feel I could go on to Tokyo.”