Chinese author Mo Yan has won the Nobel Literature Prize for writing that mixes folk tales, history and the contemporary, the Swedish academy has announced.
''Through a mixture of fantasy and reality, historical and social perspectives, Mo Yan has created a world reminiscent in its complexity of those in the writings of William Faulkner and Gabriel Garcia Marquez, at the same time finding a departure point in old Chinese literature and in oral tradition,'' the Swedish academy said on Thursday.
Yan, whose real name is Guan Moye and was born in 1955, ''with hallucinatory realism merges folk tales, history and the contemporary'', the jury said.
Mo Yan has published novels, short stories and essays on various topics, and despite his social criticism is seen in his homeland as one of the foremost contemporary authors, the Nobel committee noted.
In his writing Mo Yan draws on his youthful experiences and on settings in the province of his birth.
Last year, the literature prize went to Swedish poet Tomas Transtroemer.
The literature prize is the fourth and one of the most watched announcements this Nobel season, following the prizes for medicine, physics and chemistry earlier this week.
The Nobel Peace Prize will be announced on Friday, with the field of possible winners wide open, followed by the Economics Prize on Monday, wrapping up the Nobel season.
As tradition dictates, the laureates will receive their prizes at formal ceremonies in Stockholm and Oslo on December 10, the anniversary of the death of prize creator Alfred Nobel in 1896.
Because of the economic crisis, the Nobel Foundation has slashed the prize sum to eight million Swedish kronor ($A1.18 million) per award, down from the 10 million kronor awarded since 2001.