Last Updated at 1:50 p.m. Eastern
President Barack Obama said he doesn't feel he deserves the Nobel Peace Prize, but will accept the award as a "call to action."
Mr. Obama wasless than a year into his first term in office - a move that surprised analysts and possibly offered fodder to his critics.
The Norwegian Nobel Committee said the prize was awarded to Mr. Obama for "his extraordinary efforts to strengthen international diplomacy and cooperation between peoples" and cited the president's outreach to the Muslim world and attempts to curb nuclear proliferation.
The committee said Mr. Obama's efforts to promote a "global response to global challenges" cemented their decision.
At a news conference outside the White House Friday, Mr. Obama said he was "both surprised and deeply humbled" by the award.
"Let me be clear, I do not view it as a recognition of my own accomplishments, but rather as an affirmation of American leadership on behalf of aspirations held by people in all nations," the president said.
"To be honest, I do not feel that I deserve to be in the company of so many of the transformative figures who've been honored by this prize - men and women who've inspired me and inspired the entire world through their courageous pursuit of peace.
"But I also know that this prize reflects the kind of world that those men and women and all Americans want to build, a world that gives life to the promise of our founding documents."
The president will accept the prize at a December ceremony in Norway, reports CBS News White House correspondent Mark Knoller.
According to a White House spokesman, Mr. Obama will donate the $1.4 million prize to charity.
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Defending their surprising decision, the committee chairman said they sought not just to reward the winner of the Nobel Peace Prize, but to "enhance" the recipient's actions - to promote peace.
"Only very rarely has a person to the same extent as Obama captured the world's attention and given its people hope for a better future," Thorbjoern Jagland, chairman of the Nobel Committee said. "In the past year Obama has been a key person for important initiatives in the U.N. for nuclear disarmament and to set a completely new agenda for the Muslim world and East-West relations."
"We do hope that this can contribute a little bit to enhance what he is trying to do."
But for as much as the committee seeks to help Mr. Obama, they may done just the opposite.
"What the president is trying to do, at the moment, is pass contentious health care legislation. Giving him a prize that many will see as underserved - and that aligns him with European elites instead of average Americans - isn't going to help that effort," writes CBSNews.com's Brian Montopoli. "At the conservative National Review, they're already joking the president will next get Major League Baseball's Cy Young award."
In response to GOP criticism of Obama receiving the award, Democratic National Committee communications director Brad Woodhouse said Republicans had "thrown in its lot with the terrorists."
For his part, Mr. Obama was careful to share the award's spotlight during Friday's remarks.
"This award must be shared with everyone who strives for justice and dignity; for the young woman who marches silently in the streets on behalf of her right to be heard, even in the face of beatings and bullets," the president said. "For the leader imprisoned in her own home because she refuses to abandon her commitment to democracy; for the soldier who sacrificed through tour after tour of duty on behalf of someone half a world away; and for all those men and women across the world who sacrifice their safety and their freedom and sometime their lives for the cause of peace."
Mr. Obama's name had been mentioned in speculation before the award but many Nobel watchers believed it was too early to award the president.
"I don't think anybody expected this," CBS News chief Washington correspondent and "Face the Nation" host Bob Schieffer said on Friday's "Early Show". In his mind, the prize decision was more of a commentary on the previous administration than the current U.S. President.
"It's almost as if they're saying, 'We're giving you this prize for winning the election,'" said Schieffer.
Mr. Obama said his administration was working to "establish a new era of engagement in which all nations must take responsibility for the world we seek." He cited nuclear proliferation, climate change and the Israeli-Palestinian peace process as key to his global goals.
"And even as we strive to seek a world in which conflicts are resolved peacefully and prosperity is widely shared, we have to confront the world as we know it today," the president said, acknowledging his upcoming decision on whether to increase troop levels in Afghanistan and continued efforts to dig the country out of a staggering recession.
Knoller reports that Mr. Obama is only the third U.S. President to win the Nobel Peace Prize while still in office. Theodore Roosevelt won it in 1906 and Woodrow Wilson in 1919.
Former President Jimmy Carter also won the prize in 2002 but that was more than two decades after he left office.
In his 1895 will, Alfred Nobel stipulated that the peace prize should go "to the person who shall have done the most or the best work for fraternity between the nations and the abolition or reduction of standing armies and the formation and spreading of peace congresses."
Unlike the other Nobel Prizes, which are awarded by Swedish institutions, he said the peace prize should be given out by a five-member committee elected by the Norwegian Parliament. Sweden and Norway were united under the same crown at the time of Nobel's death.
The committee has taken a wide interpretation of Nobel's guidelines, expanding the prize beyond peace mediation to include efforts to combat poverty, disease and climate change.