Only breaking his maiden at his previous outing, Camelot held off Rostropovich and Saxon Warrior, both trained by Aidan O'Brien, in a pulsating finish to the mile and a half classic at The Curragh.
It was the first Classic success for Joseph, who won last year's Melbourne Cup for Lloyd and Nick Williams and partners with Rekindling.
"It's unbelievable and it hasn't sunk in yet,' said Joseph O'Brien, who won the Irish Derby as a jockey on Latrobe's sire Camelot in 2012.
"The plan was to drop Latrobe in but there was pace on early and Donnacha found himself racing prominently. He had a good position and when committed he Latrobe the horse showed he was very good, tough and honest.
"Today was plan A and we'll let the dust settle before deciding where he'll go next. I'll talk to Lloyd and Nick (Williams) and we'll see what they want to do."
Latrobe has several options ahead of him and is now 5-1 for the St Leger, 20-1 for the Arc and shortened to 25 (from 50) for the Melbourne Cup by Betfair.
With two wins and three seconds from just five starts, Latrobe is the first Group I winner for Montjeu's high class son Camelot and is his eighth stakes-winner.
Latrobe was bought for 65,000 guineas by his trainer from the Tattersalls October Book One Yearling Sale and is a half-brother to Group III winner Diamond Fields from the Shamardal mare Question Time.
Nick Williams Tweeted - A big thank you to my friends @TomMagnier and MV Magnier who both strongly suggested we pursue the progeny of Camelot, as usual they were right. I guess that is why they are the worlds best. #coolmore #camelot #latrobe
Camelot stood in Australia at Coolmore for just one season and his lone crop of foals are rising three year-olds.
Given the burgeoning success of his first Northern Hemisphere crop of three year-olds highlighted by Latrobe, the owners of his Australian offspring are entitled to be optimistic about their prospects here in the season ahead.