First half goals from Geraldine McLaughlin and Emma McGrory had given Donegal a sensational one point lead at the break, 2-04 to 0-09.
Donegal added five more points in the second half, but Kerry hit six – leaving the sides all square at the final whistle 2-09 to 0-15.
Katie Herron was in sensational form for Donegal, hitting a number of superb points from play.
Kerry nipped back into the lead at the start of the first period of extra time but Donegal squared it again from a free after Geraldine McLaughlin was flattened in a poor challenge and Geraldine converted from the free.
McLaughlin then worked a goal chance for Orla Carr but the Kerry keeper somehow kept out the effort.
Donegal then wasted good possession and Kerry then registered three unanswered points to lead 0-19 to 2-10.
Louise Galvin then hammered home a goal to stretch Kerry’s lead to six points; and it was so undeserved, Donegal had been the better side for much of the first period of extra time.
McLaughlin broke free to score a point to reduce the deficit to 1-19 to 2-11 but Kerry pulled ahead again and won out in extra-time 1-22 to 2-14.
But Donegal Ladies – and their coach Davy McLaughlin – can hold their heads high after being written off by all the pundits before this game.
With that sort of performance, Donegal’s Senior Ladies can push on from this and come back even stronger next season.