Incredibly, the shortstop is the first member of the 27-time World Series champions to capture the award from the US magazine, which began honouring athletes in 1954.
The 35-year-old team captain has been a member of five World Series championship teams with the Yankees and batted .334 this season while making a career-low eight fielding errors to claim Gold Glove honours for a fourth time.
Jeter surpassed the late Lou Gehrig as the Yankees' all-time hit leader this season.
During the Fall Classic against the Philadelphia Phillies, Jeter also received the Roberto Clemente Award, given to a MLB player who combines community service with excellence on the field.
US swim star Michael Phelps won the Sportsman of the Year in 2008 after hauling in eight gold medals at the Beijing Olympics.
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