He received 62 first-place votes, followed by Erik Spoelstra of the Miami Heat with 24 votes from a panel of sports writers and broadcasters. New York's Mike Woodson finished third and San Antonio's Gregg Popovich, who won the award last season, was fourth.
The Nuggets went 57-25 -- the league's fourth-best record -- and captured the No. 3 seed. But the Nuggets were eliminated by the Golden State Warriors 92-88 in Game 6 last Thursday night.
"I am honored and energized to represent coaching and be their ambassador as coach of the year and continue to symbolize the great coaching there is in the NBA," Karl said in a statement. "There are probably seven or eight guys who are deserving of it and another 10 or 15 other coaches who have done a great job and aren't getting any recognition."
It's the first time Karl has won the award in 25 seasons in charge. He joins Doug Moe as the only Denver coaches to earn the honor.
The Nuggets surged down the stretch, winning a team-record 15 straight at one point and going 24-4 after the All-Star break. They also won a franchise-best 38 games at the Pepsi Center.
In Karl's up-tempo offense this season, the team led the league in scoring, fast-break points and points in the paint. They struggled in the playoffs against a Warriors squad led by Stephen Curry, in part because they were without one of their top players, Danilo Gallinari, who was out with a torn ACL.
Karl has been criticized by some fans after a fourth straight first-round exit.
Denver's first-round flameout comes after the Western Conference seemed more wide open with Oklahoma City losing All-Star Russell Westbrook to a season-ending knee injury.
After the postseason elimination, Karl called it one of the most disappointing defeats in his nine seasons in Denver.
Karl boasts a 1,131-756 record with the Nuggets, Milwaukee Bucks, Seattle SuperSonics, Golden State Warriors and Cleveland Cavaliers. He's also turned in 21 straight non-losing seasons, which is tied with Phil Jackson for the longest streak in league history.
Moe won the award for the Nuggets in 1987-88, when his team went 54-28.
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