Both his first novel "A Pale View of Hills" from 1982 and the subsequent one, "An Artist of the Floating World" from 1986, take place in Nagasaki a few years after World War II.
The UK author has also written scripts for film and television.
Kenya's Ngugi wa Thiong'o was listed among 2017 favourites to win.
British author Kazuo Ishiguro, best known for his novel "The Remains of the Day", won the Nobel Literature Prize on Thursday, the Swedish Academy said.
The 62-year-old, "in novels of great emotional force, has uncovered the abyss beneath our illusory sense of connection with the world," the Academy wrote in its citation.
Born in Nagasaki, he moved to Britain with his family when he was five years old, only returning to visit Japan as an adult.
Both his first novel "A Pale View of Hills" from 1982 and the subsequent one, "An Artist of the Floating World" from 1986, take place in Nagasaki a few years after World War II.
"The themes Ishiguro is most associated with are already present here: memory, time, and self-delusion," the Academy said.
"This is particularly notable in his most renowned novel, 'The Remains of the Day'," which was turned into a film with Anthony Hopkins acting as the duty-obsessed butler Stevens.
"Ishiguro's writings are marked by a carefully restrained mode of expression, independent of whatever events are taking place," it said.
Apart from his eight books, Ishiguro has also written scripts for film and television.
Ngugi
Kenya's Ngugi wa Thiong'o, currently a Professor of English and Comparative Literature at the University of California, was listed among 2017 favourites to win.
Despite being tipped to win since 2010, he is yet to take the coveted prize.
His vast body work comprises novels, essays, short stories and plays.
Nigeria's Wole Soyinka was the last African to scoop the honour in 1986.
The prize was last year awarded to American singer-songwriter Bob Dylan, to the surprise of many across the world including the US singer himself.
