Peng, who has slipped to No.182 in the WTA Rankings because of injury problems, took a wildcard from the tournament and emerged victorious in the final by beating a player ranked almost 130 places ahead of her 7-6, 6-2.
It was Riske who made the early running but Peng proved to be obdurate opposition, saving nine break points before eventually succumbing to the American.
However, her advantage was short lived, with Peng breaking back immediately. Riske went up a break one more to give herself a chance to serve for the set at 6-5, but history repeated itself and Peng forced a tiebreak, which she eventually won.
Riske had a hangover heading into the second set, falling a break behind in the first game. Peng doubled her advantage soon after and closed out the match to confirm a stunning upset.
"The match was really tough for me today," Riske said after the match.
"I had a really tough day in general, playing Kuznetsova earlier, I did the best I could, Peng had a great match, she was the better player today.
"I think this year was huge for me, I finished in the top 50. I take a lot of pride in it and confidence from my season, I look forward to what 2017 brings."