"The choice of Mahmoud Abu Zeid pays tribute to his courage, resistance and commitment to freedom of expression," media outlets quoted Maria Ressa, UNESCO jury president, as saying in Paris on Monday.
UNESCO will officially award its prize to Shawkan on May 2 to mark World Press Freedom Day, the agency said.
"The UN Working Group on Arbitrary Detentions has qualified his arrest and detention as arbitrary and contrary to the rights and freedoms guaranteed by the Universal Declaration of Human Rights and the International Covenant on Civil and Political Rights," UNESCO said, Presstv Reported.
Egypt's Foreign Affairs Ministry in a statement on Sunday voiced its "profound regret” about the move, arguing Shawkan faced terror-related charges.
Egypt’s Parliament Speaker Ali Abdelaal told the state news agency MENA on Monday that UNESCO “intends to award a person who is accused of a felony.” He added that the UN agency “has tried before to take a political approach in some issues” and urged UNESCO to keep its focus on culture and science instead.
The government arrested Abu Zeid in 2013 as he photographed security forces dispersing an anti-government sit-in, during which three journalists and hundreds of protesters were killed.
Abu Zeid, widely known as Shawkan, who is still in detention, and over 700 other people face many charges, which include belonging to the outlawed Muslim Brotherhood movement, possessing firearms and murder. If convicted, he could face death penalty.
International rights organizations have repeatedly denounced Shawkan's imprisonment and urged Egyptian authorities to drop charges against him.
Amnesty International and The Committee to Protect Journalists say a crackdown by the government of President Abdel Fattah el-Sisi has muzzled freedom of expression after the overthrow of Egypt's first democratically-elected president Mohamed Morsi in mid-2013.
Amnesty says Shawkan was imprisoned merely for doing his job as a photojournalist.