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Woodley caused problems for the undefeated YouTuber-turned-boxer in the third round after he cut him open with an accidental headbutt.
However, Paul overcame the early scare and rallied back with a sensational stoppage win in the sixth round at the Amalie Arena in Tampa, Florida.
The 24-year-old American star, who now holds a 5-0 professional boxing record, waited for the right moment before unleashing a devastating right hook on Woodley.
Woodley immediately crumpled to the canvas, with the referee waving off the rematch and Paul climbing onto the ropes to celebrate his hard-fought win.
US network Showtime has now uploaded new footage to social media showing the exact moment Paul knocked out the 39-year-old former UFC star.
Paul was initially slated to fight fierce rival Tommy Fury at the pay-per-view event before the former Love Island star was forced to pull out due to a bacterial chest infection and broken rib.
The YouTuber-turned-boxer paid tribute to Woodley, but he also accused Fury of being a “b***h” after he “backed out” of the fight.
Speaking after his win, Paul said: “This guy [Woodley] is a legend. Don’t take anything away from his career as a UFC champion and respect him for taking the fight on two weeks’ notice because Tommy Fury is a b***h.
“He backed out of the fight. This [is] a real fighter, a real dog and a warrior. This guy is a tough fighter right there -- legend.”
The Problem Child added: “It was a tough fight. The blood was getting in my eye from when he elbowed me. He was throwing me on the ground -- dirty headbutt.
“But it is what it is. I got the job done and I knew it would happen like that.
“I was setting it up the whole fight. He didn’t see that s**t coming. He was catching, catching. Come around. Good morning.”
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