The Wales forward, 26, hit the post and had a strike disallowed before tapping in his 43rd goal in the Spanish top flight, beating Gary Lineker's tally.
Madrid led through Karim Benzema's wonderful half-volley, before Sevilla's Kevin Gameiro missed a penalty.
Cristiano Ronaldo and Jese, either side of Bale's goal, sealed the win.
However, despite producing one of their best performances in recent weeks, Zinedine Zidane's side are still 10 points adrift of arch-rivals Barcelona in the title race.
Relive a dramatic night at the Bernabeu
Bale has become a firm favourite at the Bernabeu since his world record £85m move from Tottenham in September 2013, scoring his 43 league goals at an impressive rate.
Despite suffering with several injuries since arriving, Bale's strike-rate has not suffered - netting more than once every two games in his 76 La Liga appearances so far.
There had been a slight doubt over whether he would even start Sunday's game against sixth-placed Sevilla.
Bale will miss Wales' two friendly games next week because of fitness concerns and the impending birth of his second child.
But not only did he play, he outshone Ronaldo and Benzema in a full-strength Real attack.
Bale looked sharp from the start, his pace and movement causing problems for the Sevilla defence, and teeing up Benzema's stunning opener.
After seeing Sevilla's inspired keeper Sergio Rico tip his drive onto the post and then wrongly being ruled to have strayed offside when he converted Ronaldo's header, he finally passed ex-Barcelona and England striker Lineker's tally after the break with a simple finish from six yards.
And when the Welshman was withdrawn after 70 minutes, the Bernabeu crowd responded with a standing ovation.
More to follow.
Gareth Bale became the leading British goalscorer in La Liga history as Real Madrid thumped Sevilla in an action-packed match at the Bernabeu.