The Leeds second-string picked up the title beating their university rivals by 43 points to 40.
Coming into the match as the highest seeded side in the competition, Leeds were made to work hard for the title against an ever improving Portsmouth team.
Key to the side’s success was an impressive defence forcing numerous turnovers.
In a gripping tie Leeds managed to keep their noses in front to secure the three point victory and take home the trophy.
Leeds along with Pythons, had been given a bye in the quarter-finals which saw Leeds Headingley pull out a surprise victory over Portsmouth Ducks and Bury Saints beat the club’s youth team Bury Earls.
Saints and Pythons then played an enthralling match in the semi-finals, Pythons winning by a single point against the Saints for the third time in the season.
Leeds Cosmos were faced up against local rival Headingley in the semis, winning 62-35 to secure the final match up against Portsmouth.
In the battle for third place Bury Saints missed out by a point again as Headingley outlaws won 35-34, beating the eastern side for the first time, a remarkable result for the side which finished two places lower in the national league.
Bury Earls started strongly against Portsmouth Ducks in the battle for fifth but eventually the experience of Ducks proved too strong for the youngsters.
Operations Director Richard Jackson said he was delighted at the first outing for the challenge cup.
"It was a major objective for Finals Day to be inclusive and not just be about the elite competition. I am delighted that so many teams entered our Challenge Cup and in future years, we will always do whatever possible to get as many clubs as we can involved. Congratulations to Leeds Cosmos on their victory and to all the developing teams that played on the day."