Jailed Chinese dissident Liu Xiaobo won the 2010 Nobel Peace Prize on Friday for championing reform and human rights in a move that is certain to anger Beijing.

The writer and university professor was honoured "for his long and non-violent struggle for fundamental human rights in China," Norwegian Nobel Committee president Thorbjoern Jagland said in his announcement.

"The Norwegian Nobel Committee has long believed that there is a close connection between human rights and peace," he added.

China offered no immediate reaction to the award which is sure to infuriate the country's communist rulers who jailed 54-year-old Liu for 11 years for subversion last year.

That followed the 2008 release of "Charter 08", a manifesto for reform signed by more than 300 Chinese intellectuals, academics and writers sponsored by Liu.

Norway, which fears a possible diplomatic backlash from China, was the first nation to congratulate Liu while Amnesty International called him a "worthy winner" and urged the China to release all prisoners of conscience.

The London-based human rights group said it hoped the award "will keep the spotlight on the struggle for fundamental freedoms and concrete protection of human rights" in China.

The Chinese government has frequently warned the Norwegian Nobel Committee to steer clear of pro-democracy advocates in general, and recently specifically warned them off Liu.

But Jagland insisted that the Nobel Committee has the right to question the human rights record of one of the world's great powers.

"China is in breach of several international agreements to which it is a signatory, as well as of its own provisions concerning political rights," said Jagland, adding that "we have a responsibility to speak when others are unable to speak."

Liu was a key figure in the pro-democracy student movement in China in 1989, which was brutally crushed by Chinese authorities and culminated in the Tiananmen Square crackdown.

He had been detained on several occasions, and in December 2009 he was convicted of subversion and sentenced to 11 years in prison.

Speaking in China Liu Xiaobo's wife Liu Xia said she was "so excited" by the Nobel award.

In recent years Chinese dissidents have routinely been named as top candidates for the prestigious prize but have not won.

In 1989, China was incensed that the Nobel Committee chose the Tibetian spiritual leader Dalai Lama for the Peace Prize.

Oslo's fears of a backlash from China come as Norway and China are in negotiations to forge a bilateral trade agreement, a deal which the Norwegian government hopes to sign as soon as possible.

This year, the Nobel Committee considered a record 237 individuals and organisations for the Peace Prize, which carries with it an award of 10 million Swedish kroner (1.49 million dollars, 1.09 million euros).

The award is to be presented in Oslo on December 10. Other Nobel laureates will pick up their prizes in Stockholm on the same day.

Last year, the Nobel Committee stunned the world and the recipient alike by awarding the honour to US President Barack Obama, who had been in office less than nine months, and while the United States was waging simultaneous wars in Afghanistan and Iraq.

The Peace Prize is the most closely-watched Nobel, and follows awards for excellence in medicine, chemistry, physics, and literature. On Monday, the prize for economics will round out the 2010 Nobel season.

The first Nobel Peace Prize was awarded to Red Cross founders Jean Henry Dunant and Frederic Passy in 1901. Since then, it has been awarded 90 times, with the committee opting 19 times to bypass handing out the award.