Originally a black Bakelite phone, later painted crimson and engraved with Hitler's name, the relic was found in the Nazi leader's Berlin bunker in 1945 following the regime's defeat.
The auction house Alexander Historical Auctions, which did not reveal the winning bidder's identity, had estimated its worth between $200,000 and $300,000. The starting bid was set at $100,000.
The Maryland company auctioned off more than a thousand items including the phone and a porcelain sculpture of an Alsatian dog for $24,300.
Both winners bid by telephone.
More than 70 years old, the Siemens rotary telephone is embossed with a swastika and the eagle symbolic of the Third Reich.
Alexander House dubbed the phone - which Hitler received from the Wehrmacht, Nazi Germany's armed forces - as "arguably the most destructive 'weapon' of all time, which sent millions to their deaths."
It said Hitler used it to give most of his orders during the last two years of the Second World War.
Russian officers gave the device to British Brigadier Sir Ralph Rayner during a tour of the bunker shortly after Germany's surrender.
Rayner's son, who inherited the phone, put it up for sale, its paint now peeling to reveal the original synthetic black resin surface.
Andreas Kornfeld of Alexander House told AFP its estimates were based on a number of factors, including "rarity and uniqueness."
"It would be impossible to find a more impactful relic than the primary tool used by the most evil man in history," the auction house said in a statement. "This was not a staid office telephone."
"This was Hitler's mobile device of destruction."