Danilo Gallinari added 14 points for the Nuggets, who led 71-49 at intermission to set a season high for points in a half. They shot 62 percent in the first two quarters and had three players in double figures.
They led by as many as 35 in the second half and were up 101-69 heading into the fourth period when most of the regular players watched the rest of the game.
Aaron Brooks scored 16 points off the bench and Tyreke Evans had 15 for the Kings, who have lost four straight.DeMarcus Cousins was held to three points. It's the first time in his past 17 games he failed to score in double figures.
The Nuggets took charge with a dominant first quarter when they shot 74 percent and hit 17 of 23 shots. Lawson led the way with 15 points and hit all three of his 3-point attempts.
Sacramento committed five turnovers in the period, two of which came on consecutive possessions and led to layups by Lawson.
The Kings, who were coming off a 10-point loss to Oklahoma City on Friday, were never really in it. They led by one early in the game but a 28-7 run by Denver made it 35-15 late in the first quarter.
The Kings showed brief life early in the second quarter when Marcus Thornton hit a 3-pointer to cut it 39-28, but the lead never dipped below double digits.
Denver's bench, led by JaVale McGee, scored 14 points in the second quarter as the lead grew to 22. Iguodala's 3-pointer with 10 seconds left in the second finished the Nuggets best half of the season.
Denver opened the third quarter on a 17-6 run to lead 88-55.
NOTES: The Nuggets tied a season high for points in a quarter when they scored 39 in the first. ... Denver is 14-3 at home against the Kings dating back to the 2003-04 season. ... Cousins failed to record a double-double for the second straight game. Before that he had a streak of six consecutive double-doubles.