The Orson Wells classic was chosen by 144 film critics and directors polled separately by the British Film Institute.
The critics put Alfred Hitchcock's "Vertigo" in second place, followed by Jean Renoir's "La Regle du Jeu."
The directors' second choice was "The Godfather" and "The Godfather Part II," followed by Federico Fellini's "8-1/2."
Nick James, editor of Sight and Sound, the BFI's magazine, said the twin polls confirmed Wells as the "Shakespeare of modern cinema."
"The Critics' Poll is a touchstone for worldwide film opinion," he said. "For the last 40 years 'Citizen Kane' has topped the Critics' Poll."
"Citizen Kane," the story of an American newspaper baron, made in 1941, pushed the boundaries of cinema and changed the way films were made.
James said it owed its continuing critical acclaim to those advances.
"Pushing all the resources of a Hollywood studio to its limits, the film is a dazzling formal experiment and compelling portrait of a great man's life," he said.
The twin polls have been carried out every 10 years by the BFI since 1952 and are considered prestigious in the film industry.
The critics questioned include U.S. film critic Roger Ebert and British critics Barry Norman and Jonathan Ross.
Notable directors who polled their views include Quentin Tarantino, Sam Mendes and Bernardo Bertolucci.
There were no British films among the top tens, although Sir Carol Reed's "The Third Man" was at number 35.
Also notably absent were titles such as "Star Wars" and "Some Like it Hot," which consistently score highly in public surveys.
However, classic musical "Singing in the Rain" was voted tenth most popular by the critics, while "Lawrence of Arabia" scored highly with the directors.
The age of the films was also telling, with the most recent on either list being Martin Scorsese's 1980 movie "Raging Bull" at number six on the directors' list.