Navardauskas, who rides for the Garmin-Sharp squad, clocked four hours 23 minutes 14 seconds over the 182-kilometre leg from Tarvisio to Vajont, which featured two category-2 climbs, including an uphill finish.
Italians Daniel Oss and Stefano Pirazzi finished second and third, respectively. Oss crossed 1 minute, eight seconds behind and Stefano Pirazzi was 2:59 back.
Nibali maintained a 41-second lead over 2011 Tour de France winner Cadel Evans, as the top of the overall standings remained unchanged.
Defending champion Ryder Hesjedal finished 130th in Tuesday's stage, 13 minutes 35 seconds behind Navardauskas. He slipped to 37th in the overall classification, 31 minutes 39 seconds behind Nibali.
The stage was held in conjunction with the 50th anniversary of the Vajont damn disaster, which killed nearly 2,000 people and devastated the area on Oct. 9, 1963.