Media playback is not supported on this device
It ends a long wait for success, with Great Britain's 3-0 victory over the Kiwis in 2007 their last triumph against either New Zealand or world champions Australia.
England took an 8-0 lead with Gareth Widdop's penalty followed by a converted Elliott Whitehead try.
Media playback is not supported on this device
Jason Nightingale superbly touched down in the corner before the break and the match became increasingly tense after the restart.
The Kiwis, trailing 8-6, looked to be wrestling the ascendancy but NRL-bound Whitehead burst through to score.
And there was a huge cheer from the sold-out Wigan crowd when the video referee awarded a try after skipper Sean O'Loughlin touched down under the sticks late on.
Even then, the Kiwis kept coming as Roger Tuivasa-Sheck and Jordan Kahu scored to make it 20-14 and leave England desperately hanging on, desperate to close out the game, in the final minute.
The match was England coach Steve McNamara's last before his contract expired - and he may well find himself with a new deal now his team have finally won a series.
Going into the contest, his side had a record of just two victories from 11 matches against Australia and New Zealand.
McNamara is still waiting for his first win against the Kangaroos but after near misses in the 2013 World Cup and 2014 Four Nations, the significance of Saturday's win cannot be overstated.
McNamara has established a base for his team in Burton and maintained all along that they are building and progressing - and now he has something to show for it.
An England team with class in all areas, and players such as Sam Burgess, George Burgess and Sam Tomkins absent from the current squad, can look forward to the 2016 Four Nations in England and Scotland with great confidence.
McNamara made two changes to his starting XIII for this game, and as former GB coach Brian Noble acknowledged: "You've got to hand it to Steve for those."
Huddersfield winger Jermaine McGillvary, the top try scorer in Super League last season, was a menace to the Kiwis with his powerful and aggressive kick returns. He also made a brilliant tackle under extreme pressure from Nightingale at a point when the match was in the balance.
Even more significant was the presence of Wigan half-back Matty Smith, who brought a measure of control and menace with his smart kicking game.
Not only did he help manoeuvre his team around the park, it was his smart grubber that allowed Whitehead to touch down for his team's opening try.
Questions were asked about the atmosphere at the previous two Test matches in Hull and London, but there could be no complaints in Wigan.
Sold out weeks ago, the knowledgeable crowd fully embraced what former former GB captain Jamie Peacock described as a "blood and thunder" match.
Spray flew off the players during collisions on a greasy surface and the crowd roared on every England attack, with the noise ratcheting up even further when Whitehead scored the game's decisive try after a lengthy pointless period in the second half.
And yet they also acknowledged brilliance from the opposition, applauding when watching a replay of Nightingale's brilliant athletic leap to avoid Zak Hardaker and touch down in the corner shortly before the break.
Of course, the teams were playing to the converted in Wigan and it does not change the fact the chance to win over some new fans was lost during the poor game at the Olympic Stadium last weekend.
Good question. McNamara is out of contract and the issue of his future needs to be resolved. England and Scotland will co-host the 2016 Four Nations at the back end of next year, which will also see Australia and the Kiwis compete. The fixtures for that tournament have yet to be announced.
England: Z Hardaker (Leeds); J McGillvary (Huddersfield), K Watkins (Leeds), J Bateman (Wigan), R Hall (Leeds); G Widdop (St George Illawarra), M Smith (Wigan); J Graham (Canterbury Bulldogs), J Hodgson (Canberra), C Hill (Warrington), E Whitehead (Catalans Dragons), L Farrell (Wigan), S O'Loughlin (Wigan, capt).
Subs: J Roby (St Helens), T Burgess (South Sydney), M Cooper (St George Illawarra), B Ferres (Huddersfield).
New Zealand: R Tuivasa-Sheck (Sydney Roosters); J Nightingale (St George Illawarra), J Kahu (Brisbane), D Whare (Penrith), S Kenny-Dowall (Sydney Roosters); P Hiku (Manly), K Nikorima (Brisbane); J Bromwich (Melbourne), I Luke (South Sydney, capt), S Moa (Sydney Roosters), K Proctor (Melbourne), T Harris (Melbourne), A Blair (Brisbane).
Subs: M Taupau (Wests Tigers), B Matulino (NZ Warriors), A Glenn (Brisbane), L Brown (Penrith), I Liu (Sydney Roosters).
England won a thrilling decisive Test at a wet and passionate Wigan to seal a 2-1 series win over the world's top-ranked team, New Zealand.