The OPCW was formed in 1997 to enforce the Chemical Weapons Convention, the first international treaty to outlaw an entire class of weapons. Based in The Hague, Netherlands, it has largely worked out of the limelight until this year, when the United Nations called on its expertise to help investigate alleged chemical weapons attacks in Syria.
"The conventions and the work of the OPCW have defined the use of chemical weapons as a taboo under international law," the Norwegian Nobel Committee said in Oslo. "Recent events in Syria, where chemical weapons have again been put to use, have underlined the need to enhance the efforts to do away with such weapons."
Friday's award comes just days before Syria officially joins as the group's 190th member state. OPCW inspectors are already on a highly risky U.N.-backed disarmament mission based in Damascus to verify and destroy Syrian President Bashar Assad's arsenal of poison gas and nerve agents amid a raging civil war.
The OPCW's director-general, Ahmet Uzumcu said the award was a recognition of the group's work for global peace in the past 16 years.
"But (it's) also an acknowledgement of our staff's efforts, who are now deployed in Syria, who have been, in fact, making a very brave effort there to fulfill their mandate," he told the Norwegian public broadcaster NRK.
He said 27 OPCW experts were visiting chemical weapons storage and production sites in Syria. "And they are making an inventory of them. They are sealing them with a view to in fact eventually begin the destruction of those stockpiles," Uzumcu said.
There was no immediate report on what the organization would do with the $1.2 million prize.
By giving the peace award to an international organization, the Nobel committee found a way to highlight the devastating Syrian civil war, now in its third year, without siding with any group involved. The fighting has killed an estimated 100,000 people and forced millions of Syrians to flee their homes and country, according to the U.N.
U.N. war crimes investigators have accused both Assad's government and the rebels of wrongdoing, although they said earlier this year that the scale and intensity of rebel abuses hasn't reached that of the regime.
In the past, seven nations - Albania, India, Iraq, Libya, Russia and the United States, along with a country identified by the OPCW only as "a state party" but widely believed to be South Korea - have declared stockpiles of chemical weapons and have or are in the process of destroying them.
However, the committee noted that some countries have not observed the deadline of April 2012 for destroying their chemical weapons. That applies especially to the U.S. and Russia, said Nobel committee chairman Thorbjoern Jagland.
"I have to recognize that they have particular challenges. They have huge stockpiles of chemical weapons," he told The Associated Press. "What is important is that they do as much as they can and as fast as they can."
After an Aug. 21 chemical weapons attack that killed hundreds in Syria, Assad was faced by the prospect of possibly devastating U.S. strikes against his military. To avert that, he admitted his chemical weapons stockpile and his government quickly signed up to the Chemical Weapons Convention and allowed OPCW inspectors into his country.
Syria is scheduled to formally become a member of the organization on Monday.
The first OPCW inspection team arrived in Syria last week, followed by another team this week. They have already begun to oversee the first stages of destruction of Assad's chemical weapons.
The struggle to control chemical weapons began in earnest after World War I, when agents such as mustard gas killed more than 100,000 people and injured a million more. The 1925 Geneva Convention prohibited the use of the weapons but the production or storage of chemical weapons wasn't outlawed until the Chemical Weapons Convention came into force in 1997.
"During World War II, chemical means were employed in Hitler's mass exterminations," the prize committee said. "Chemical weapons have subsequently been put to use on numerous occasions by both states and terrorists."
According to the OPCW, 57,740 metric tons, or 81.1 percent, of the world's declared stockpile of chemical agents have been verifiably destroyed. Albania, India and "a third country" - believed to be South Korea - have completed the destruction of their declared stockpiles.
An OPCW report earlier this year said the United States had destroyed about 90 percent of its stockpile of the weapons, Russia had destroyed 70 percent and Libya 51 percent.
Nations not belonging to the OPCW include North Korea, Angola, Egypt and South Sudan. Israel and Myanmar have signed but not ratified the convention.
The OPCW did not figure prominently in this year's Nobel speculation, which focused mostly on Malala Yousafzai, the 16-year-old Pakistani girl who was shot in the head by the Taliban last October for advocating education for girls.
"She is an outstanding woman and I think she has a bright future and she will probably be a nominee next year or the year after that," Jagland, the committee chairman, told The Associated Press. He declined to comment on whether she had been considered for this year's award.
The European Union won the 2012 Nobel Peace Prize for uniting a continent ravaged by two world wars and divided by the Cold War.
Earlier this week, Alice Munro of Canada won the Nobel Literature Prize for her short-story prowess; three U.S.-based scientists won the chemistry award for developing a powerful new way to do chemistry on a computer; three Americans won the medicine prize for discoveries about how substances are moved around within cells; and the physics award went to a British and a Belgian scientist whose theories helped to explain how matter formed in the universe.
The peace prize was the last of the original Nobel Prizes to be announced for this year. The winners of the economics award, added in 1968, will be announced on Monday.
Ritter reported from Stockholm. AP reporter Mark Lewis in Oslo, Norway, contributed to this report.