Malmo finished with 67 points from 30 games, two points ahead of local rivals Helsingborg who could only draw 0-0 at home to Kalmar.
Former Sheffield Wednesday favourite Roland Nilsson, who was born and raised in Helsingborg and used to play for the club, told Swedish TV that winning the league as Malmo manager was "wonderful".
"Every day should be like this," he said.
Malmo, who went into the final round of matches with a much better goal difference than Helsingborg, attacked from the first whistle and took the lead through Jiloan Hamad's rasping volley in the 17th minute.
Agon Mehmeti made it 2-0 on the stroke of half-time, Daniel Larsson squaring unselfishly for a simple finish.
Sixty-five kilometres away at the Olympia Stadium, Rasmus Jonsson failed to convert three excellent chances for Helsingborg.
At the Swedbank Stadium a host of Malmo fans danced up and down the touchline as they waited for the final whistle and when it came they rushed past stewards and police to celebrate on the field.
Captain Daniel Andersson was one of only two survivors from Malmo's last league-winning team in 2004.
"There have been tough years since our last title so this is fantastic, magical," he said.
At the other end of the table, Atvidabergs were relegated along with bottom club Brommapojkarna after drawing 1-1 with AIK Stockholm.
Gefle finished third from bottom and will now play the third-placed team in Sweden's second tier for the right to play in the top flight next season.
Malmo will play in the second preliminary round of the 2011/12 Champions League while Helsingborg and third-placed Orebro enter the qualifiers for the Europa League.
