The emirate's Yas Island has been transformed into a closed-off fight zone able to stage four UFC events in July after UFC President Dana White secured it.
Masvidal was drafted in at six days notice to face Nigerian Usman and the American could not find an answer to Usman's powerful wrestling game.
The 33-year-old successfully defended his belt with a gritty display to earn scores of 50-45, 50-45, 49-46 from the three judges after five gruelling rounds in an "octagon in the sand" without spectators.
Authorities set up a safety zone including an arena, hotel, training facilities and a restaurant which will only be open to fighters, coaches, UFC staff and other event personnel.
There are more than 2,500 UFC personnel and Yas Island employees staying within the zone, with all local staff having been in quarantine for 14 days.
Usman should have been fighting Gilbert Burns in the first main event of the four-event run but the Brazilian tested positive for coronavirus so Masvidal stepped in.
The 35-year-old American found a home for his strikes early on as he started the faster of the pair. He had a clear speed and accuracy advantage in the striking department and he stung the champion with multiple shots during the opening exchanges, while nullifying Usman's early takedown attempts.
But Usman exerted constant pressure on the challenger as he denied Masvidal the time and space to throw his strikes. Usman looked to use his clinch work to wear on Masvidal, with much of the second round spent against the cage in a lengthy and gruelling exchange. The legacy of the round was a nasty cut above Masvidal's right eye, courtesy of an accidental clash of heads.
A huge slam takedown from Usman was the biggest moment of the third round as the champion continued to smother Masvidal's striking.
That pattern repeated through the final two rounds as Usman shut down Masvidal, who had earned his shot at the title with a trio of stoppage victories over Darren Till, Ben Askren and Nate Diaz in 2019.
Usman's victory improved his record to 17-1 and extended his winning streak to 12 fights in the UFC.
"Jorge is a tough guy and I give him credit for that," said Usman.
"They call him 'Gamebred' for a reason - he's always game to fight. I'm just a level better. I have more tools in the toolbox."
Volkanovski retains featherweight title
In the night's co-main event, Alexander Volkanovski, 31, retained his featherweight title by edging a split-decision verdict after five tight, tense rounds with former champion Max Holloway.
Australian Volkanovski, who defeated Holloway via unanimous decision to dethrone the Hawaiian and win the 145lb title at UFC 245 in December, was dropped in the first two rounds of the rematch. He had to battle his way back into the contest as he claimed the last three rounds to deny Holloway revenge.
Despite having to train in near-isolation in his home town of Waianae, Holloway, 28, appeared to have made the necessary adjustments from their first meeting, which saw Volkanovski hold the edge in the striking exchanges.
Holloway briefly dropped Volkanovski with a head kick at the end of the opening round, then repeated the trick with an uppercut at the end of the second as he started the sharper of the two.
The third round saw Volkanovski start to work his way back into the contest with the closest round of the fight, before outpacing the former champion through the fourth and fifth rounds to take the fight to the scorecards.
Volkanovski ended up edging a split decision with scores of 47-48, 48-47 and 48-47 to extend his winning streak to 19 fights, including nine in the UFC.
"I knew it was two rounds apiece going into that last round. I had to win that last round," said Volkanovski.
Yan captures bantamweight title
In the first title fight of the night, Russian bantamweight Petr Yan demolished two-time former featherweight champion Jose Aldo to capture the vacant bantamweight title.
Yan, 27, registered a staggering 194 significant strikes - a UFC record - en route to a fifth-round TKO finish of Aldo as he joined lightweight king Khabib Nurmagomedov as Russia's second UFC champion.
Yan stung Aldo in the opening 90 seconds with a big right hand and appeared to have the Brazilian badly hurt with a body shot in the closing seconds of the opening round as the Russian took charge early. But Aldo started to find a regular home for his powerful leg kicks as he worked his way back into the contest in round two.
With the fight in the balance heading into round three, Yan pushed the pace and worked Aldo relentlessly to the body and head as he started to sap the Brazilian's gas tank.
Then, as Aldo slowed in the championship rounds, Yan turned up the heat as he battered his foe with ground strikes until referee Leon Roberts waved off the fight at the 3:24 mark of the final round.
After the fight, Yan paid tribute to his opponent, then named the man he wants to face in his first title defence.
"Aldo is a legend. I have only respect for him," he said.
"My division has very tough fighters in the top five. The number one contender is Aljamain Sterling. I will fight everyone. I like it, it's my job."