A stunning lap of 1:26.600s on the second runs in Q3 extended Hamilton's advantage over the rest to an evantual 0.547s over Kimi Raikkonen.
It is the fifth time that Hamilton has taken Pole at Silverstone, and fourth sucessive time in a row he has done so.
Sebastian Vettel will line-up third, having been out-qualified by Raikkonen for only the third time this season, with Max Verstappen completing the second row for Red Bull.
After a difficult Friday, Nico Hulkenberg was fifth quickest for Renault, with the two Force India's of Sergio Perez and Esteban Ocon just behind.
Stoffel Vandoorne actually took part in Q3 for the first time, and also out-qualified Fernando Alonso for the first time, on merit, and will start in eighth.
Valtteri Bottas was fourth quickest, but a five place .grid penalty for a gearbox change drops him to ninth just ahead of Grosjean's Haas.
Cometh the hour, cometh the Hamilton
After the first two segments of qualifying were run in wet and damp conditions, Q3 was completely dry and Hamilton, who had topped Third Practice was quickly on the pace, with a 1:27.231s, a comfortable 0.2s ahead of Vettel, with Bottas and Raikkonen close behind.
It was while he was winding up for this lap, that Hamilton eased off at Club Corner, to find some space, but Grosjean was approaching on a hot-lap, and immediately radioed to say he had lost time.
The stewards quickly decided that there was no case to answer, and so Hamilton will lead the field off on tomorrow's formation lap.
On the final runs, Bottas's efforts were effectively ended at Farm, as he locked up and ran wide, being 0.111s slower than Hamilton's benchmark time in Sector 1.
While he failed to improve, Raikkonen did, vaulting from fourth to second, with Vettel failing to join his championship rival on the front-row.
The top five fastest laps were all over 150mph.
Hulkenberg slotted into a respectable fifth, with Perez not sure he could have caught the Renault.
Grosjean did improve his time on his second flying lap, but stayed 10th.
Palmer drops out in 11th
Jolyon Palmer, who missed a load of First Practice, was ocne again on the bubble to get into Q3, but just missed out on a second Q3 appearance of the season, for Renault, after being pushed out of the top 10 by late improvements from Vandoorne and Perez.
The two Toro Rosso's, will start 12th and 13th, Danill Kvyat ahead of Carlos Sainz Jr, who actually qualified 14th quickest.
The reason for Sainz's bump in position was that Alonso has a 30 place grid penalty, so drops to last.
Felipe Massa was slowest of all in this 15 minute segment of qualifying, the Williams struggling for grip in the conditions.
Alonso fastest in Q1 as Ricciardo goes pop
As the qualifying hour started, teams were split between the Intermediate and slick tyres, with Verstappen sure that the green walled Inter was the best tyre.
After quickly setting the fastest time, Ricciardo suffered a "big" engine failure on the Wellington Straight, coming to a stop just before the old pit-lane at Woodcote.
He was 20th, but will start 19th because of Alonso's penalty, having already known he'd drop five places because of a gearbox change before the Reanult engine went pop.
Alonso made a late racing pit-stop to switch to slicks, and just made the line to start a timed lap.
As it was only he and Ocon on slicks, he started setting green sector times, and the Spanish driver was able to top Q1, the first session McLaren have topped this season.
Lance Stroll was the unlucky driver to lose put because of Alonso's lap, being joined in falling at the first hurdle by Kevin Magnussen in the Haas and the two Sauber's of Pascal Wehrlein and Marcus Ericcson.
*Under investigation for blocking Romain Grosjean
|4th||Max Verstappen||Red Bull|
|6th||Sergio Perez||Force India|
|7th||Esteban Ocon||Force India|
*Five place grid penalty applied
|12th||Danill Kvyat||Toro Rosso|
|13th||Carlos Sainz Jr||Toro Rosso|
*Five place grid penalty applied
*30 plae grid penalty applied