Otto, renowned for designs which incorporated lightweight tent-like structures, had been informed yesterday he had won the accolade shortly before his death, a statement said.
"Frei Otto's career is a model for generations of architects and his influence will continue to be felt," said Tom Pritzker, who chairs the foundation which bestows the honor.
"The news of his passing is very sad, unprecedented in the history of the prize. We are grateful that the jury awarded him the prize while he was alive."
In comments by the architect made before his death, Otto said he had "never done anything to gain this prize."
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"My architectural drive was to design new types of buildings to help poor people, especially following natural disasters and catastrophes," he said.
"So what shall be better for me than to win this prize? I will use whatever time is left to me to keep doing what I have been doing."
"He believed in making efficient, responsible use of materials and that architecture should make a minimal impact on the environment," a statement said.
Otto was "a Utopian who never stopped believing that architecture can make a better world for all."
Peter Palumbo, the chairman of the Pritzker prize jury, described Otto as a "titan of modern architecture."
"His loss will be felt wherever the art of architecture is practiced the world over, for he was a universal citizen," Palumbo said in a statement.