The 22-year-old Fremantle midfielder was voted by his peers as this year's winner at a function attended by more than 600 people in Melbourne on Tuesday night.
Fyfe wasn't present to accept the award, given the Dockers' semi-final against Port Adelaide this Saturday night, but accepted the award from captain Matthew Pavlich in a live cross from Perth.
In one of the closest counts in recent players' association history, Fyfe polled 945 votes from Ablett (787), ahead of Lance Franklin (428), Dyson Heppell (274) and Josh Kennedy (234).
Geelong captain Joel Selwood was named the game's most courageous player for the second consecutive year, while Luke Hodge was named best captain ahead of Selwood and Ablett.
Western Bulldogs youngster Marcus Bontempelli, after narrowly placing second in last week's NAB AFL Rising Star to Lewis Taylor, was the clear winner for best first year player.
Bontempelli beat St Kilda's Luke Dunstan and Taylor for the honour.
Essendon's Heppell was named the under-22 captain for the second straight year, with Hawthorn's Jack Gunston vice-captain, as selected in the fan voting category.
Jonathon Griffin was awarded the education and training excellence award.
AFL players' president Luke Ball said Fyfe was a deserving winner of the only player-voted award in the League.
"I think it comes as no surprise that Nat has won his first MVP, with the season he has had," Ball said.
"At just 22 years of age, he's had a standout year and this was rewarded with being named in the All Australian squad of 40.
"To be recognised by the 800 players who voted showcases just how much value is placed on this award and Nat's performance this year is a reflection of that."
Five-time MVP winner Gary Ablett and Jordan Papalia. Pictures: Getty Images
Nadia Coppolino with Geelong star Jimmy Bartel
Bombers Dyson Heppell and Ben Howlett pose for a photo
Kelly and retired Bulldog Daniel Giansiracusa
Hawk great Jason Dunstall speaks to 'Best Captain' winner, Luke Hodge
Jaeger O'Meara presents Bulldog Marcus Bontempelli with the Best First Year Player award
Rhiannon Joyce with Suns young star Jaeger O'Meara
Leigh Matthews Trophy
Nat Fyfe (Fremantle)
Gary Ablett (Gold Coast)
Lance Franklin (Sydney Swans)
Dyson Heppell (Essendon)
Josh Kennedy (Sydney Swans)
Scott Pendlebury (Collingwood)
Tom Rockliff (Brisbane Lions)
Joel Selwood (Geelong)
Robbie Gray (Port Adelaide)
Patrick Dangerfield (Adelaide)
The Robert Rose most courageous award
Best first year player