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The 21-year-old Dubliner, who has cerebral palsy, was awarded this year's �18,750 prize at the brewery's London headquarters for his autobiographical view of his life, Under the Clock.
Others in the running for the award were Ian McEwan, for the novel, A Child in Time, Francis Wyndham for his first novel, The Other Garden and Seamus Heaney for a volume of poetry, The Haw Lantern.
Mr Nolan is able to write only with the aid of a word-processing computer and what has been described as a 'unicorn stick', strapped to his forehead. His mother, Bernadette, has to hold his head while he is writing.
In an acceptance speech read by his mother, Mr Nolan said: "I want to shout with joy. My heart is full of gratitude."
He went on: "You all must realise that history is now in the making. Crippled man has taken his place on the world's literary stage."
His prize-winning book tells how he was deprived of oxygen at birth.
It left his brain damaged, meaning he was unable to talk, walk or use his hands - but his intellect was unharmed.
The book is not told in the first person, but uses the character of a young man called Joseph Mehan to present his own moving struggles with his disabilities.
Mrs Nolan said winning the book of the year prize would mean a great deal to her son: "Now he's being taken as a serious writer.
"He's up there with all of the established writers and now he's beaten them at their own game so that must give him a sense of respectability as a writer now."
Mr Nolan's writing has been likened to that of James Joyce.
His first book, a volume of poetry called A Dam-burst of Dreams, was published in 1980 when he was 14.
In Context
Mr Nolan's first book of poetry won the Spastics Literary Prize.
He gave half the profits to a trust for the handicapped.
Since his Whitbread success, Christopher Nolan has written a novel, The Banyan Tree, published in 1999.
The book took him 12 years - and half a million strokes with his unicorn stick - to write.
It tells the uneventful life story of Minnie O'Brien, a shopkeeper's daughter from rural Ireland.
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