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The second-wicket partnership between Gilchirst and Marsh (79 not out) was the highest in Twenty20 cricket and it steered the hosts to a mammoth 232 for two, highest total of this season so far in the IPL, after electing to bat.
The previous best partnership in T20 cricket was of 170 runs for the first wicket, raised by South Africa's Graeme Smith and Loots Bosman against England in 2009.
Punjab then broke Bangalore's seven-match winning streak by bundling them out for 121 in 17 overs and also recorded second largest victory in the history of IPL.
The previous best was scored by Kolkata Knight Riders, who had thrashed Bangalore by 140 runs in 2008 edition.
It was Punjab's fourth win in a row and they need to beat Deccan Chargers in their last outing on Saturday and also hope that some other results also go in their favour.
Punjab remain on fifth position in the table with 14 points but improved their net run-rate. It was -0.183 and now courtesy the big win it is +0.271.
Bangalore, who have already qualified for the play-offs, remain on top with 17 points despite defeat.
Big hitting Chris Gayle has orchestrated many wins of Bangalore and his needed his magic yet again while chasing such a huge total but the West Indies batsman could not do it for the side this time around.
Gayle could even open his account today as Ryan Harris had him caught behind by Gilchrist.
Harris (3/28) also dismissed Virat Kohli (11) to make early in-roads and Bangalore buckled under pressure.
AB de Villiers (34) was top scorer for Bangalore while Piysh Chawla (4/17) was the most successful bowler for Punjab with his four wickets.
Earlier, chips were down for Punjab at one stage as they had scored just 30 runs in the first six overs and had lost opener Paul Valthaty (20) but Gilchrist's power hitting changed the face of their innings.
Gilchrist's whirlwind knock, his second IPL century, came off just 55 balls and was adorned with nine sixes and eight fours. Gilchrist was well supported by compatriot Marsh, whose unbeaten 79 came off 45 balls and his knock was studded with 12 boundaries including five sixes.
The two Australians were on song and reduced Bangalore bowlers to mere pedestrians with their brutal hitting. Johan van der Wath was the most expensive bowler as he conceded 50 runs in his quota of four overs while Charl Langeveldt went for 48 runs and he took both the wickets.
At the start Valthaty yet again failed to convert a good start as he perished after sizzling for a while. He smashed Langeveldt for a six and two fours during his 17-ball stay but departed while going after the same bowler.
Conditions were helpful for the pacers and Bangalore bowlers did extremely well by restricting Punjab to 30 runs in in the power-play period.
Gilchrist, who was surprisingly silent, launched Abhimnayu Mithun for a six over deep square leg and what followed was just magical for the 'hosts'.
Gilchrist and Marsh creamed Sreenath Aravind for 21 runs by hitting the bowler for a six and a four each.
A baffled Virat Kohli brought spinner Chris Gayle for his second spell but there was no stopping Gilchrist, who hit the West Indian for two more, taking 15 runs from that over.
Next in the firing line was Langevedlt, who was hit for three sixes, including the biggest six of the tournament -- 122 metres. The third one brought up fifty for the Australian.
Marsh then made his presence felt by hammering der Wath for 30 runs as he punished the South African with three sixes and as many fours and also completed his fifty in the process.
Gilchrist then hit the same bowler for a six and four to raise team's 200 in the 18th over.
The Punjab skipper completed his century with a four off Langeveldt in the third ball of the last over and was out in the penultimate ball.