In a poll of European soccer journalists from 52 countries organised by France Football magazine, the 28-year-old was rewarded for his outstanding scoring record for Milan since he joined the Italian side from Dynamo Kiev in 1999.
Shevchenko, who dedicated his Ballon D'or to the Ukraine people, has scored 102 goals in Serie A over the last six seasons and helped Milan win the Champions League in 2003 and the Italian title in 2004.
"I'm happy and proud to receive this reward, which is one of the most important in the world," he said. "I want to dedicate this trophy to my people. I'm Ukrainian and I'm proud of it."
Portuguese forward Deco and Brazilian midfielder Ronaldinho, both of Barcelona, were second and third respectively. Shevchenko received 175 votes, Deco 139 and Ronaldinho 133.
Shevchenko was fourth in last year's poll behind Czech winner, Pavel Nedved of Juventus, and is one of three players in line for FIFA's World Player of the Year award. The others are Ronaldinho and French striker Thierry Henry of Arsenal who came fourth in the European poll with 80 votes.
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