The BBC's Rageh Omaar: "A vindication of its sometimes confrontational work"

"We are very very proud," said MSF Secretary-General Jean-Marie Kindermans.

"We are very pleased and very honoured," he told BBC News Online.

The prize includes a cash award of about $960,000.

"With this amount of money," Mr Kinderman added, "we will work more for forgotten populations, which is the more difficult situation to get funds for."

The French-based organisation was founded in Paris in 1971. It is renowned for its presence in the world's war zones, with volunteers regularly working in great personal danger.

MSF says its goal is to provide medical aid wherever needed, whether it be a natural disaster or an armed conflict.

The organisation has won acclaim for its work during the war in Biafra in the 1970s, and in conflicts in Nicaragua, Vietnam, Afghanistan and Rwanda.

Its workers are currently involved in relief operations in East Timor and Kosovo.

MSF members are often the last aid workers to leave war zones.

MSF's President James Orbinski: "We're very surprised"

The organisation has an annual budget of about $270m. Most of the moeny comes from private donations.

The nearly $1m cash attached to the Nobel Prize is welcome, MSF Secretary General Kindermans said. But since it was less than 1% of MSF's annual budget, the honour and prestige was clearly more important.

MSF Director of Operations Vincent Ganssens: "We are very happy to win this prize"

He hoped, Mr Kindermans said, that it would allow MSF to operate in more areas where local potentates so far prevented his organisation from helping the population.

The five-member Nobel Prize committee made the decision at its last meeting on 29 September but kept the decision secret until the announcement on Friday.

The announcement was made in the Norwegian capital Oslo.

Founding member of MSF Bernard Kouchner: "It wsa very difficult to convince people we had the right to cross borders"

The nomination of several dissidents for this year's award drew sharp criticism from the Chinese Government.

A foreign ministry spokesperson said the nominations of Wei Jingsheng and Wang Dan made a "mockery of the prize" and was a "flagrant interference in China's internal affairs".