The Nobel committee described both Malala Yousafzai and Kailash Satyarthi as “champions of peace.”
Ms Yousafzai, 17, said the award was “for those forgotten children who want education. It is for those frightened children who want peace. It is for those voiceless children who want change.
“I am here to stand up for their rights, raise their voice. It is not time to pity them. It is time to take action so it becomes the last time that we see a child deprived of education.”
Mr Satyarthi said the prize would give him “great opportunity” to intensify his work against child slavery.
In October 2012, Malala was shot in the head by Taliban gunmen for campaigning for girls’ education in Pakistan. She has been living in the UK since her evacuation for treatment.
The youngest-ever recipient of a Nobel prize has dedicated the prize money to the Malala Fund “to help give girls everywhere a quality education and call on leaders to help girls like me.”
“I will continue this fight until I see every child in school,” she added, saying she felt much stronger after the attack because I know, no-one can stop me, or stop us, because now we are millions, standing up together.”
Mr Satyarthi said he was “representing the sound of silence” and the “millions of those children who are left behind. There is no greater violence than to deny the dreams of our children,” he said, refusing to accept that the shackles of slavery can ever be stronger than the quest for freedom.”
Nobel committee chairman who emphasised the importance of education said the road to democracy and freedom is paved with knowledge.
Mr. Thorbjorn Jagland praised the recipients for their great effort and courage.
Malala and Satyarthi shared the prize money of $1.4 million.