Mo Yan, one of China's leading writers of the past half-century, on Thursday won the Nobel Literature Prize for his writing that mixes folk tales, history and the contemporary, the Swedish Academy announced.

At 57 he became the first Chinese national to win the prize, and the initial official reaction indicated it would be held up as a victory for China, in sharp contrast to Beijing's angry response to the 2010 Nobel Peace Prize for dissident Liu Xiaobo.

Chinese-born writer, political dissident and exile Gao Xingian, who received French citizenship in 1997, won the Nobel Literature Prize in 2000 but it was ignored by the Chinese press at the time.

Mo Yan's works explore the brutality and darkness of 20th-century Chinese society with a cynical wit.

He is perhaps best-known abroad for his 1987 novella "Red Sorghum", a tale of the violence that plagued the eastern China countryside -- where he grew up -- during the 1920s and 30s.

The story was later made into an acclaimed film by leading Chinese director Zhang Yimou.

"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.

"Winning the Nobel prize has stunned me, as I always thought it was very distant for me," Mo Yan said in a recorded interview posted on the Nobel prize website.

"On hearing the news that I won the award, I was very happy," he was quoted as saying by the official China News Service.

"I will focus on creating new works. I will strive harder to thank everyone."

AFP could not immediately reach Mo Yan, whose mobile phone was switched off.

State media said he was at his home in rural Shandong province, where many of his works are set.

The Nobel prize is often dismissed in China as Western-focused, but users of the country's hugely popular microblogging services broadly welcomed the win as a triumph for Chinese literature.

It was the most discussed topic on Weibo, China's version of Twitter, with almost three million web-users posting messages within two hours of the announcement.

The Swedish Academy hailed Mo Yan, a pseudonym that means "Don't speak", and whose real name is Guan Moye, for a body of work which, "with hallucinatory realism merges folk tales, history and the contemporary."

The Academy's permanent secretary, Peter Englund, said the Academy had spoken to Mo Yan by telephone and quoted him as saying he was "overjoyed and terrified" at being given the prize.

Englund said his use of satire was important to be able to enjoy the dark sides in his work, describing it as both crude and sensual.

"There are things (in his books) that are among the most frightening things I have read," Englund told Sweden's Aftonbladet TV.

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.

His acclaimed works also include "Big Breasts and Wide Hips", "Republic of Wine" and "Life and Death are Wearing Me Out".

His work generally looks back at China's tumultuous 20th century in tales often infused with politics and a dark, cynical sense of humour.

The backdrops for his various works have included the 1911 revolution that toppled China's last imperial dynasty, Japan's brutal wartime invasion, newly Communist China's failed land-reform policies of the 1950s and the madness of Mao Zedong's 1966-76 Cultural Revolution.

His latest novel, 2009's "Frog", is considered his most daring yet, due to its searing depiction of China's "one child" population control policy and the local officials who ruthlessly implement it with forced abortions and sterilisations.

Despite such content, Mo Yan has so far deftly managed to avoid running into serious trouble with Communist authorities, aided by his position as vice chairman of the state-sanctioned Chinese Writers Association.

"We are very happy. This is a happy thing for the China literary world," He Jianming, another vice chairman of the association, said on Thursday after the prize was announced.

Mo Yan has also supported official policies stating that art and literature must serve the socialist cause -- and, by extension, not threaten Communist Party rule.

The author grew up in Gaomi in Shandong province in northeastern China, the son of farmers.

As a 12-year-old during the Cultural Revolution he left school to work, first in agriculture, later in a factory and in 1976 he joined the People's Liberation Army and began to study literature and write.

His first short story was published in a literary journal in 1981.

The Nobels for medicine, physics and chemistry were announced earlier this week.

The 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 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 ($1.2 million, 930,000 euros) per award, down from the 10 million kronor awarded since2001.