The 17-year-old from Colorado went into the final as the favorite, but was expected to be pushed by fellow American Elizabeth Beisel and Russia's Anastasia Zueva.
But Franklin, who looked as relaxed as ever heading into the race, took an early lead and never appeared troubled as she came home in 2:04:06. Zuevaawas was 1.86 seconds back in second place, with Beisel in third.
Franklin's time smashed the old record set by Zimbabwe's Kirsty Coventry in 2009 by 0.75 seconds and continued the teenager's spectacular run at these Games. Coventry could only manage sixth place as Franklin's star, which has shined throughout London 2012, rose another notch higher."Whats it going to take to beat Missy?" Beisel wondered aloud. "Apparently it is going to take a world record. Right now in backstroke she is unbeatable; she is amazing. It is going to take a lot to beat her.
It was Franklin's last individual event of these Olympics, but she has a chance to add to her tally in the 4x100 medley relay on Saturday. She went into Friday's final having already claimed gold in the 100-meter backstroke and 4x200 meter freestyle relay, as well as a bronze in the 4x100 free relay.
Franklin has lit up the swimming competition and established herself as a genuine superstar. She has already decided not to cash in on her performances by turning professional and will instead head to college.
"It is exciting to be part of this incredible generation that I think is going to take things forwards and take American swimming on," Franklin said. "This Olympics is turning into the youth Olympics with so many young winners and I think that can only be a great thing for swimming."
The efforts of Franklin have provided a boost for the beleaguered city of Aurora, Colo., her hometown, where a tragic shooting left 12 dead and 60 injured last month.
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