The Mercedes driver was 0.149 seconds quicker than the German’s Ferrari, which was 0.164secs ahead of Red Bull’s Daniel Ricciardo in third place.
Ricciardo’s team-mate Max Verstappen was struggling, 0.9secs slower, and behind Ferrari’s Kimi Raikkonen and Mercedes’ Valtteri Bottas.
Hamilton clinched his fourth championship two races ago in Mexico.
Ferrari looking quickest on long-run pace
The session suggested that the the fight between the top three teams could be very close in the race.
Hamilton had the edge on one-lap pace, but there was only 0.3secs between the three teams, and on long-run speed the order was swapped around, with Ferrari appearing quickest and Red Bull between them and Mercedes.
“It was a good day,” said Vettel. “The car was good. The balance was good straight away. I think it will be very close. If we can do the usual step to Saturday and improve the car a little bit – I don’t think we need to do too much – then it should be a good day.
“It is important to finish the season on a high. The better the result, the better the mood.”
Still millions in prize money at stake
Force India were best of the rest ahead of Renault’s Nico Hulkenberg.
McLaren’s Fernando Alonso was 10th, ahead of Williams’ Felipe Massa, in his final grand prix.
The second McLaren of Stoffel Vandoorne was 12th, just over 0.1secs behind Alonso and the second Renault of Carlos Sainz struggling in 13th, nearly 0.7secs slower than team-mate Hulkenberg.
The German’s pace could be significant because Renault are four points behind Toro Rosso in a fight for sixth place in the constructors’ championship – on which millions of pounds depend – and the Red Bull junior team appear to be having a difficult time so far at the Yas Marina circuit.
Pierre Gasly was Toro Rosso’s quickest driver in 15th place, with team-mate Brendon Hartley 19th after two spins. Hartley has a 10-place grid penalty for the race after using too many engine parts.
Haas are also in the fight for sixth, two points behind Renault, but were also struggling – Kevin Magnussen 16th and team-mate Romain Grosjean 20th and last after a spin.