It was also a first win in the race for Sheikh Mohammed's Godolphin team, for whom Appleby saddled Masar to their maiden Derby win at Epsom in June.
Godolphin's other two Cup runners were unplaced, as the Saeed bin Suroor-trained Best Solution did not jump with the field and lost six lengths at the start of the race.
The Aidan O'Brien-trained horse suffered a fractured shoulder during Tuesday's race and had to be euthanised, Racing Victoria's executive general manager - integrity services, Jamie Stier, said in a statement.
After watching video of Kerrin McEvoy galloping Cross Counter a week ago Appleby knew Sheikh Mohammed's first Cup victor was on track.
Terrible news. The Cliffsofmoher suffered a fractured right shoulder when injured in the Melbourne Cup, unfortunately could not be saved.
After Enable forced a rewrite of the record books at the Breeders' Cup on Saturday, another Newmarket-based horse made history at the 158th Melbourne Cup during the early hours of this morning.
He said: "It was an unbelievable run - I'm completely speechless".
The Melbourne Cup has again been marred by the death of a horse, this time the Irish-trained The Cliffsofmoher.
"He loves fast ground", O'Brien said, "the better the ground, the better his chances".
Sheikh Mohammed spoke regularly with Appleby over the past few months as they formulated the plan to get Cross Counter in the $7.3 million Melbourne Cup.
And despite coming so close to winning Australia's most famous race in his second attempt with Marmelo, trainer Hughie Morrison was understandably proud at the performance of the stayer to run second to the younger and lighter-weighted Cross Counter.
"They're too slow and you need a class animal to win the Melbourne Cup and off the right weight".
RSPCA Australia says The Cliffsofmoher is the sixth horse to die during the Melbourne Cup carnival since 2013. I've spoken to His Highness and he's over the moon about this result.
"People under pressure make rash decisions, I hope we're making the right decisions now".
The stewards' report listed Marmelo, as well as Aidan O'Brien's Yucatan (11th), as mildly lame after the race, while fellow Werribee resident Magic Circle (16th) displayed signs of an exercise-induced pulmonary haemorrhage post-race.
Jockey Ryan Moore checks on The Cliffsofmoher after it broke down in the first lap of the Melbourne Cup.
"He ran his race", Bowman said.