It is the only property in New Zealand to have made the top 100 list.
Blanket Bay owner Tom Tusher said he was overwhelmed and humbled by the announcement.
"We are so small and so out of the way and are just amazed at the regard our guests have for our property.
"Conde Nast Traveler has a huge circulation and is the bible for discerning travellers, particularly in the North American market."
Tourism New Zealand chief executive George Hickton said it was a great result for Blanket Bay and New Zealand.
"Blanket Bay was also recently recognised by British Conde Nast readers when it was named best leisure hotel in Australasia.
"This second award is another real achievement for the hotel and this kind of coverage is a wonderful way for New Zealand to get noticed in very competitive long-haul markets," Mr Hickton added.
Mr Tusher said New Zealand was unique in that all the best accommodation was in small, luxury lodges and that met the travel style of today's discerning traveller.
"Today's traveller is healthier and more adventurous and is looking for the personalised attention small properties can offer.
"This is good news for New Zealand and fantastic for us in Glenorchy because we are in a pristine and beautiful place that offers the widest possible range of adventure.
"For many North American travellers, this area offers a package of Switzerland, Norway and Napa Valley rolled into one."
Mr Tusher said the standards maintained by the staff - many of whom had been with Blanket Bay since it opened its doors 10 years ago - had contributed heavily to its success.
"We have been very fortunate to secure and hold an amazing team of people including the very best chefs, managers, housekeepers and gardeners, all committed to ensuring every moment our guests spend with us is a superb experience.
"Our aim has always been to deliver the highest standards and service levels and to be well regarded internationally."
The Conde Nast Traveler Readers' Choice Awards are conducted through a questionnaire made available to all readers via a secure website.
The final tabulation of 25,008 responses was collated by Mediamark Research, of New York City.
