Vettel regrouped and ultimately overhauled Hamilton, registering a time of 1:05.092 to wind up 0.269s clear of the Briton.
"I'll do the best job I can".
"Certainly it is not a record I am proud of", said Vettel on Formula1.com. "That will not be the case", Hamilton said.
One has to note that attaining pole position does not guarantee the driver a win as has been witnessed this season.
The Austrian Grand Prix is live on CNBC and the NBC Sports app from 7:30am ET on Sunday.
The ambient temperature at the start of the 60-minute session was 73 degrees Fahrenheit (23 degrees Centigrade) and the track temperature was 86 degrees Fahrenheit (30 degrees Centigrade). "It makes sense for him to push as hard as he can to win the race".
Vettel recovered from a spin after hitting the inside kerb at Turn 1 to edge Bottas with a 1m06.826s, but moments later Hamilton lapped three tenths quicker than his Baku aggressor on a 1m06.526s.
OUT: Jolyon Palmer (Renault), Felipe Massa (Williams), Lance Stroll (Williams), Marcus Ericsson (Sauber), Pascal Wehrlein (Sauber). He returned to the track to set a quick lap 0.349s off Hamilton and 0.041s quicker than teammate Daniel Ricciardo, who also spent an extended period of time in the garage between his low- and high-fuel runs before an MGU-H issue brought his session to an early end.
After pitting for ultra-soft tyres Bottas then set the fastest first and second sectors of the session but ran wide at Turn 9 and only managed to improve by 0.001s.
Past year the race was won by Hamilton from pole position, who also set the fastest lap at 1 minute 8.4 seconds.
Jolyon Palmer's Renault was 14th ahead of Fernando Alonso's McLaren, which developed an MGU-H problem on Friday forcing the team to remove the new "spec three" Honda power unit from his auto overnight and replace it with a less powerful "spec two" unit.
Bottas, who is third overall and 28 points behind Hamilton, said the Mercedes pre-race strategy notes did not envisage any action on his part to help Hamilton. Vettel then slotted into second again, and Grosjean's vehicle failure ensured that Bottas took pole and his team-mate was to start eighth.