The 22-year-old sensation gave the hosts the lead when she fired through Manuela Zinsberger’s hands after dodging her marker.
Six minutes later, Sjoeke Nusken headed a long-range attempt from Erin Cuthbert into the bottom corner to extend Chelsea’s advantage.
Following the interval, Johanna Rytting Kaneryd’s shot cannoned off her calf and caught Zinsberger off guard, giving Nusken the opportunity to almost certainly win.
The Gunners were only able to salvage a late consolation when Chelsea striker Catarina Macario was deflected by Kim Little’s effort.
James talked about how excited she is to play at Stamford Bridge and how that gives her the confidence to perform after the game.
She told Sky Sports, “It’s always nice to play here and I feel the freedom here with the fans. It obviously helped us gain momentum and today showed that.
“Everyone allows me to have freedom and those behind me make sure I’m doing my job defensively. And if I am, they say ‘do what you want in possession’.
“I don’t really think about it, I do what the opportunity is giving me and just try my best.”
Arsenal’s chances of winning the title are severely damaged by the outcome, as they are now six points behind Chelsea, who are currently three points ahead of second-place Manchester City.
Blues manager, Emma Hayes, was ready to give her team credit after a convincing win in West London.
She told BBC Sport, “I said that I expect a Chelsea standard and I saw that tonight in the performance. I thought it was a fabulous effort from every player to deliver what we needed.
“We’ve been depleted, we had to play Lauren James as a centre-forward today and she did a tremendous job but this is about the whole team and it’s an amazing effort from everyone.”
