Unemployment is now at 7.8 percent, down from 8.5 percent a year ago.
Statistics from Sweden's Employment Agency show that 371,000 people were out of work in August.
"Unemployment continues to fall in all groups, but especially among young people," Mats Wadman, Analysis Manager for the Employment Agency told Swedish television.
The figures also suggest that more jobs are being advertised. There were 59,000 vacancies in Sweden last month, up nearly 8,000 from August 2014.
Under Prime Minister Fredrik Reinfeldt, Sweden has enjoyed a dynamic job market
, sustained growth and low public debt. But despite the country's economic success, opinion polls put the Social Democrat-led opposition narrowly ahead of the governing Alliance.
Surveys suggest that voters are veering towards the centre-left following concerns that standards are slipping in Sweden's schools and hospitals and worries about a growing income gap in the country.
Thursday's unemployment figures could be a boost for the governing Alliance ahead of Sunday's election.
But other statistics released today indicate that Sweden is still struggling to deal with long-term unemployment, which is declining at a slower pace.
The data also reveals that almost 32,000 people were on long term sick leave in June 2014, a record in recent years.
The Swedish government tightened the rules on taking sick leave in 2008, limiting paid time off to 2.5 years. Staff should be given individual help and advise on how to re-join working life.
The latest statistics show that sick leave is now higher than before the rules were introduced. In June 2008 around 29, 000 people were on long term sick leave.