During a conference call, the 2010 Nobel literature laureate said he was "very grateful, very moved by the award", and hailed the presence alongside the jury of Silvia Lemus, wife of the late Mexican literary icon Fuentes.
About his relationship with Fuentes, who died May 15 at the age of 83, Vargas Llosa said that he learned of the author when he was very young and that "reading works like 'La Region Mas Transparente' (Where the Air is Clear) truly impressed him".
That book was the "beginning of a narrative that in the following years would achieve widespread readership", Vargas Llosa said of Fuentes' classic work.
The prize, which includes a sculpture by artist Vicente Rojo, will be presented in Mexico City Nov 11, Fuentes' birthday, in a ceremony scheduled to be presided over by Mexican President Felipe Calderon.
Mexico's National Culture and Arts Council created the prize in July.