Higgins' 11-second victory in 2008 was the closest in the event's history
Rally Isle of Man was named '2008 Rally of the Year' at the British Rally Championship Awards in Birmingham on Saturday.
Championship Manager Mark Taylor was full of praise for the event.
"The Isle of Man rally was a very popular choice. In fact they beat their nearest rival by a considerable margin", said Taylor.
It's a true reflection of their team's dedication to organising a delivering a first-class event."
The Manx event is the first to win the accolade twice, having previously picked up the award in 2005.
This is great news for the Rally Isle of Man team
Chairman Brian Walton was thrilled with the news. "This is a fantastic achievement and is testament to the hard work and dedication of our excellent team," he said.
The island's Tourism and Leisure Minister, Hon Martyn Quayle MHK, added: "This is great news for the Rally Isle of Man team and I would like to congratulate everyone involved in achieving the prestigious award for British Rally of the Year."
The 2008 event featured a Grandstand finish, with Mark Higgins claiming a fourth win by just 11 seconds over Irish Tarmac champion Eamonn Boland, the closest margin in the event's history.
Rally Isle of Man is also a round of the Irish Tarmac Championship, Dunlop/Gambia MSA British Historic Championship, British Rally Challenge and the Suzuki, Citroen and Ford Fiesta Trophies.
The 46th Rally Isle of Man takes place from the 9th to 11th July.