Hargreaves opened the scoring in the first half with an 18-yard strike
Torquay United returned to the Football League after two years away following their play-off final victory over 10-man Cambridge United at Wembley.
The U's dominated early on but the Gulls took the lead through captain Chris Hargreaves' sweet 18-yard strike.
Cambridge's afternoon went from bad to worse when Phil Bolland was shown a second yellow card for scything down Elliot Benyon.
Tim Sills sealed Torquay's victory when he headed home Wayne Carlisle's cross.
Torquay only clinched a play-off place on the final day, coming from behind to beat champions Burton.
The defeat will be hard to take for Gary Brabin's Cambridge side, who had a chance of beating the Brewers to the title on the last day.
And it will be a sense of deja-vu for the U's, who lost last year's final to the Gulls' Devon rivals Exeter.
The result consigns Cambridge, who will rue their missed chances, to a fifth season in non-league football.
Brabin's side started the brightest and Torquay keeper Michael Poke had to be alert to keep Scott Rendell from converting Jai Reason's cross early on.
Sills escaped a caution when he led with his arm into Wayne Hatswell's face, leaving the big centre-back needing medical attention and making himself a pantomime villain with the lively Cambridge fans in the process.
Hatswell was okay to continue and had an ambitious 30-yard free-kick deflected wide, moments later Reason had a curling shot from 25 yards saved easily by Poke, who then almost spilled it.
Rendell saw an ambitious 25-yard volley deflected just over for Cambridge before the Gulls' Chris Robertson had a similar effort fizz just wide.
Robbie Willmott then beat Kevin Nicholson on the edge of the area, cut inside and his shot across the goal was tipped wide by Poke - and it seemed just a matter of time before Brabin's men would score.
But it was Torquay who took the lead with veteran midfielder Hargreaves, who scored vital goals for his side in the last two games of the season, smashing home Benyon's ball, leaving Cambridge keeper Bartlett with no chance.
The goal left Cambridge stunned and Torquay almost had a second moments later, Dan Gleeson doing brilliantly to block Benyon's inviting ball and hook it out - with Danny Stevens lurking with intent.
Torquay were the better side after the break, with Kevin Nicholson firing a 25-yard free-kick just wide.
Cambridge still had chances and Gleeson had a shot blocked on the post but their afternoon disintegrated when Bolland was dismissed.
Referee Gary Sutton had no option but to send him off when he brought down Benyon on the left wing.
Torquay almost clinched it when Sills had a header tipped onto the post by Bartlett, who only joined Cambridge on an emergency loan on Saturday, and strike partner Benyon fired over the rebound from close range.
And the game was ended as a contest when Sills popped up 10 yards out for his 21st goal of the season.
Cambridge manager Gary Brabin told BBC Radio Cambridgeshire:
"I'm delighted with the lads, what they've given all season. We took automatic promotion to the last game.
"We've come to Wembley today and I thought we were the better side. We could have easily won the game.
"I still felt with 10 men we played some good football but it just wasn't to be our day.
"The lads have given me everything since day one. We've got some good young players and there's a lot to build on."
Torquay United manager Paul Buckle told BBC Radio Devon:
"I'm thrilled on many fronts. Obviously the biggest thing is getting back into the Football League but to come to such a fantastic stadium and perform how we did is wonderful.
"Cambridge are a very good side. We knew they would have quite a bit of the ball but it's not a problem as long as you know what you're doing."
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