Tim "Avicii" Bergling, a 24-year-old Stockholmer, took home the 17th annual gong for his contributions to Swedish export through music on Tuesday.
"Sweden's major international success in the world of music makes an important contribution to strengthening Sweden's brand abroad," Trade Minister Ewa Björling said in a statement.
"This is why I am very pleased today to have the opportunity to reward some of the music figures who have made a strong contribution to enhancing the image of Sweden abroad, while helping to increase Swedish exports."
Avicii was praised for challenging the genre of dance music by blending it with country music, even though the idea was initially ridiculed by his colleagues in the industry.
But his song Wake Me Up has since topped iTunes charts in over 60 countries and has sold gold and platinum in 25 countries.
"Imagine that an artist from Östermalm has not only written Swedish pop history with his debut album, but with his wide-open view towards all kinds of pop music, as a composer and producer, he has also – on several levels, not least in the way he markets himself – changed the global stage he acts on," the prize givers said.
In other categories, Abba took home the special prize for long-standing contributions to Swedish music, and TEN Music Group was awarded the first ever Commendation for achievements of particular importance to the internationalisation of Swedish music.
Abba's win marked the 40th anniversary of the band's breakthrough at the Eurovision Song Contest in Brighton.
"The winning song Waterloo laid the foundation for what became the breakthrough for a group of four that not only remain the strongest Swedish name on the global pop music stage, but also belong to the few world artists who have had the greatest impact on pop history. This was manifested in 2013 in the opening of their very own, popular Abba museum in Stockholm," the prize givers announced.