The victory gave five-times women's doubles Grand Slam champion Errani and Vavassori their maiden Grand Slam mixed doubles title in only their third major tournament together after Wimbledon and the Paris Olympics.
"It's very special, it's a dream come true for me to accomplish this thing with Sara," Vavassori said.
"She's an amazing person and player, I always watched her during her career. It was amazing to play with her in Wimbledon and the Olympics and here, we had fun."
Vavassori and Errani drew first blood and took a 6-5 lead as Townsend drilled a backhand long, but the Americans broke straight back to force a tiebreaker.
The third-seeded Italian duo blazed through the tiebreaker with ease, which appeared to fill them with confidence as they broke early in the second set to take a 3-1 lead.
Townsend and Young showed great spirit to break back and level at 4-4, but in similar fashion to the first set, their resistance was short-lived and the Italians broke in the final game to clinch victory.
The defeat marked the end of a long partnership for Townsend and Young, who have known each other since childhood and reached the semi-finals at Flushing Meadows in 2014, with 35-year-old Young set to retire from tennis and switch to pickleball.
"We were a step short, but this is a dream come true for me," Young said.
"Taylor is like a little sister, I've grown up playing Monopoly, bullying her, having fun. To play next to her in the final of the US Open is great.
"Congrats to Sara and Andrea, it was awesome."
It was more disappointment at the US Open for Townsend, who also reached the semi-finals of the women's doubles alongside Katerina Siniakova, where they lost to Zhang Shuai and Kristina Mladenovic.
Townsend and her Czech partner won the women's doubles title at Wimbledon this year.
