Gradel netted his second goal of the tournament on Wednesday to give Ivory Coast top spot in Group D, and set up a last-eight clash with Algeria.
A cautious first half was brought to life after 36 minutes as the 27-year-old Saint-Etienne attacker thundered a long-range effort beyond the dive of Joseph Ondoa.
Cameroon's attempts to get back into the game and avoid an early exit came to nothing, and Wilfried Bony should have extended Ivory Coast's lead with a volley just after the hour.
Substitute Clinton N'Jie tried to replicate Gradel's effort to level the match, but his shot was deflected wide by the resolute Ivorian defence.
Victory sees Herve Renard's side qualify for the knockout stages, while Mali and Guinea will have to draw lots to see who joins them after their 1-1 draw in Mongomo.
With so much at stake the opening exchanges were understandably cagey, and it needed a controversial decision in the 12th minute to bring about the game’s first chance.
Referee Eric Otogo-Castane awarded Cameroon a free-kick after deeming Sylvain Gbohouo had carried the ball out of his penalty area when intercepting a pass. The Ivory Coast goalkeeper was booked, although replays suggested he had been harshly treated.
From the resulting set-piece, Franck Etoundi rose unmarked seven yards from goal, but his header was deflected over.
Cameroon goalkeeper Ondoa was finally called into action after 20 minutes, the 19-year-old Barca B player reacting quickly to keep out Serge Aurier's header from a Gradel free-kick.
But with nine minutes of the half remaining, the young shot-stopper was picking the ball out of his net, as Gradel set the game alight with a stunning strike.
Having collected a pass from Siaka Tiene, the Saint-Etienne forward broke free and thundered a 25-yard effort past Ondoa.
Cameroon should have gone in level at the break as Edgar Salli cleverly worked an opening for himself, but he blazed a shot over with only Gbohouo to beat.
A scrappy start to the second half saw neither goalkeeper tested until after the hour mark, when Bony had his first attempt on target.
Manchester City's new signing used his strength to shrug off the attentions of Nicolas N'Koulou and Aurelien Chedjou on the edge of the penalty area, but his volley was punched away by Ondoa.
With time running out, plenty of Cameroon's build-up play posed a threat, but as soon as they reached the penalty area they lacked the creativity to find a way through.
Substitute N'Jie created the only real chance on Gbohouo's goal four minutes after coming on, but his audacious attempt from distance was deflected wide by Kolo Toure.
A final Cameroon chance fell to striker Vincent Aboubakar with 10 minutes to play as he met a right-wing cross, but the 23-year-old scuffed his shot and his side's elimination was confirmed.
Watch every match of the Africa Cup of Nations LIVE on British Eurosport HD or sign up to Eurosport Player and follow the action on mobile, tablet and other devices: www.eurosportplayer.com
‘Managing Leeds? It was an option that appeared, but it wasn’t the right timing. I decided it wasn’t a good idea to leave the club I was at mid-season’: Premier League boss admits to turning down opportunity to replace Jesse Marsch in 2023
‘Ruben Amorim could have waited for Real Madrid and had a better chance to be successful – to have joined Manchester United, he must be convinced in his own ability’ Former Old Trafford coach’s verdict on new boss
