As Hamilton and team mate Nico Rosberg set the pace, Vettel headed the chase, mixing it with the Force Indias of Nico Hulkenberg and Sergio Perez, who were an encouraging fourth and fifth fastest respectively.
There were a number of spins and offs as drivers tested the limits, but the only red flag came midway through the 90 minutes when Toro Rosso’s Carlos Sainz beached his car in the gravel after a spin at Parabolica.
Hamilton, the world championship points leader, was quick from the word go, and ended as the only driver to dip beneath 1m 25s, lapping in 1m 24.670s. Rosberg was left trailing by 0.463s with 1m 25.133s, but was still in a separate class as the Silver Arrows dominated.
Vettel had a spin at the first chicane late in the session, trying to better 1m 26.258s, but he had plenty of company in that bracket.
The Force Indias were again strong with their Mercedes power - though like Williams and Lotus, they won’t get the upgraded engine yet - as Hulkenberg and Perez impressed with 1m 26.612s and 1m 26.730s respectively.
Kimi Raikkonen was sixth on 1m 26.783s in the second Ferrari, as Daniel Ricciardo took his Red Bull round in 1m 26.922s to head Williams’ Felipe Massa on 1m 26.936s.
The Brazilian's team mate Valtteri Bottas was ninth on 1m 27.075s, and such a strong showing for Williams on the day on which traditionally they focus on work rather than lap times can be seen as promising.
Pastor Maldonado made the most of his Mercedes power to take his Lotus round in 1m 27.118s to complete the top ten, while Jolyon Palmer - sitting in for Romain Grosjean - was 15th in the sister car on 1m 27.669s.
Between them, Felipe Nasr made the most of Sauber’s recently upgraded Ferrari power train (still one spec behind the works cars) to take 11th on 1m 27.232s ahead of Daniil Kvayt’s Red Bull on 1m 27.275s and team mate Marcus Ericsson on 1m 27.454s, as Toro Rosso’s Max Verstappen and Carlos Sainz sandwiched Palmer with 1m 27.591s and 1m 27.907s. The Spaniard caused the only real drama of the session when he went off on the exit to Parabolica, briefly bringing out the red flags.
As expected, McLaren struggled on a circuit that demands maximum power and straight-line speed. Fernando Alonso was only 17th on 1m 28.023s, and Jenson Button 18th on 1m 28.423s. At the back, Will Stevens headed Marussia partner Robert Merhi, 1m 29.853s to 1m 29.911s.
Watch: Sainz spins at Parabolica
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