The 25-year-old was voted the winner ahead of his club teammate Sadio Mane of Senegal, future teammate Naby Keita of Guinea, Gabon's Borussia Dortmund star Pierre-Emerick Aubameyang, and Chelsea and Nigeria's Victor Moses.
Salah played a key role in helping Egypt qualify for the 2018 World Cup. It was the first time the Pharaohs made it to the Fifa tournament since 1990. The forward's stoppage-time penalty against Congo saw Egypt seal a berth in next summer's tournament in Russia.
He was also instrumental in helping Egypt reach the final of the 2017 African Cup of Nations, with the Pharaohs eventually losing 2-1 to Cameroon in February.
At club level, the Egyptian international finished the last season with 15 goals and 11 assists, helping AS Roma finish second in Serie A. His form for the Italian outfit attracted interest from Liverpool and he eventually completed a switch to Anfield in the summer.
Salah is currently the leading top-scorer in the Premier League this season with 13 goals, and his fine form for club and country in this calendar year has seen him win BBC's prestigious award. He becomes the third Egyptian after Mohamed Barakat (2005) and Mohamed Aboutrika (2008) to win it.
The Liverpool star expressed his delight after being voted ahead of Aubameyang, Keita, Mane and Moses, and also set his sights on becoming the "best Egyptian ever" after picking up the individual honour.
"I am very happy to win this award. It's always a special feeling when you win something. I feel like I had a great year, so I'm very happy," Salah told BBC Sport.
"I want to be the best Egyptian ever, so I work hard. I always follow my own way and I want everyone in Egypt to follow my way.
"I would like to thank my Liverpool teammates and I also had a good season with Roma, so I have to thank my teammates there and my teammates in the national team," he added.