Vettel, who won the Silverstone race last year from pole, posted a fastest time on Saturday of 1 minute, 29.615 seconds.
The Red Bull drivers were rampant on a revamped circuit where Vettel and Webber delivered a one-two finish last season.
Ferrari's Fernando Alonso qualified in third, 0.8 seconds off the pace.
"[The car] is just quick everywhere," said Vettel, who won the European Grand Prix two weeks ago in Spain to go third in the championship. "We were very competitive in Valencia and also here.
"Our car likes corners where you need downforce so that will always help us. Compared to last year, we have made a step forward all around."
Championship leader Lewis Hamilton was fourth -- almost one tenth of a second behind Vettel -- as the McLarens remained sluggish despite abandoning the exhaust blown diffusers that had hindered the cars on Friday, having been implemented to match Red Bull.
"We've struggled all weekend. I've never run wide or gone off at a track so many times through Friday practice and this morning," Hamilton said. "It's really down to getting a good start now because it's virtually impossible to overtake on this track. It really is.
"It's even more impossible than it was before, I think, because they have added another couple of faster corners, which is very, very hard to follow through."
The track will make it even harder for defending world champion Jenson Button to finally achieve a podium finish at the British GP. The McLaren driver has failed on his previous 10 attempts and qualified in 14th Saturday on his home track.
Button's best time was 1:31.699 -- some 0.3 seconds out of the top 10 -- in a car he called "undriveable." Button is second in the drivers' championship, six points behind Hamilton but six ahead of Vettel.
"This weekend has been tricky for us, but that wasn't normal," Button said. "We have got new aero parts on the car, we've a new front wing, and that is working really well, but something felt very wrong then.
"I was getting on with the car very well this morning, even though we did not have much practice, and it was moving along nicely, but I don't know what happened then."
Nico Rosberg qualified in fifth for Mercedes ahead of Renault's Robert Kubica, while German teammate Michael Schumacher will start in 10th for the race he won three times before initially retiring in 2006.