Concordia singled out Ismail Eskin as having made an outstanding contribution to freedom of information.
But the organisation said he was unable to attend, saying it understood authorities believed he might seek asylum.
“Journalist Ismail Eskin, who was to receive our prize with a Turkish colleague in the name of jailed Turkish journalists… has not received his visa,” Concordia secretary general Astrid Zimmermann said.
“We are very annoyed that Ismail Eskin has not received his visa…” said Zimmermann. She added that Eskin's Turkish colleague Banu Guven was able to attend the Vienna ceremony.
“The Austrian authorities panicked at the idea he might have been able to claim asylum, which was not his intention even though he is prevented from working in his own country,” Zimmermann said.
A foreign ministry spokesperson said Eskin had not in fact been refused a visa but that his case would take longer to process owing to incomplete paperwork.
Social Democratic lawmaker Hannes Jarolim said he found it “incomprehensible in this day and age that the Austrian embassy in Turkey should act without regard to the situation of countless jailed and threatened journalists” alluding to a widespread crackdown after last July's failed coup.
According to the Turkish Journalists' Association (TGC), 170 media organisations have been shut down, 105 journalists detained and 777 press cards revoked since the coup attempt against President Recep Tayyip Erdogan.