Captain Sergio Ramos scored the winning spotkick as accidental candidates Real Madrid won the Super Cup.
Real Madrid only qualified for the new format competition because Barcelona qualified twice. Barca won the league and were runner-ups in the Copa del Rey last year giving them two slots of which one had to be rescinded to their rival.
Athletico Madrid beat Barcelona while Real beat Valencia to set up an all Madrid final.
After a goalless two hours in Saudi Arabia the game went into penalties per the rules. Ramos sent goalkeeper Jan Oblak the wrong way to secure victory in a tensely contested final.
Saul Niguez and Thomas Partey missed their penalties for Atletico diffusing 120 minutes of hardwork for the underdogs.
João Felix has the best opportunity of the first half but he could only drag his effort wide after dispossessing Ramos in the box.
Real were the livelier of the sides in the second half with Luka Jovic coming close to scoring after wriggling past two defenders.
Athletico had to wait until the 79th minute before another goalscoring chance presented itself. Alvaro Morata’s well-timed volley from Kieran Trippier’s searching cross was well blocked by Thibaut Courtois.
Real Madrid were lucky to have finished the game with 11 men and especially lucky to have had Courtois for the penalty shootout as five minutes to the end of the 120, the Belgian goalkeeper axed down Morata just outside the box to impede a goalscoring move. He could have seen red.
Real Madrid lifts their 11th Super Cup trophy but it’s another final-day loss for Athletico Madrid to their City rivals as two Champions League finals come to mind.