Vietnamese-Australian writer Nam Le won Australia's richest fiction prize for short story collection The Boat. (Prime Minister's Literary Award for Fiction)

Nam Le has won Australia's richest literary award for fiction for his collection of short stories, The Boat.

The Prime Minister's Literary Award for Fiction, accompanied by a cash prize of $100,000 Australian ($97,570 Cdn), was established by Australian Prime Minister Kevin Rudd in 2008.

The non-fiction prize, also awarded Sunday, was split between Evelyn Juer's biography, House of Exile: The Life and Times of Heinrich Mann and Nelly Kroeger-Mann, and Drawing the Global Colour Line, by Marilyn Lake and Henry Reynolds.

Le's stories draw on his life as a Vietnamese refugee who grew up in Australia but also narrate the experiences of a tourist in Tehran, a Colombian gangster and an aging New York artist.

Le, who came to Australia from Vietnam in 1979, is now fiction editor of the Harvard Review. His stories have been widely anthologized and critically acclaimed. The Boat also won the Dylan Thomas Prize.

The judges recommended the book for its daring scope and excellence of its execution and the excitement generated by every story.

Le was not at the prize ceremony but sent an acceptance speech, read in his absence by his publisher, Ben Ball.

"It's an anodyne thing to say, but maybe it needs to be said, and said again and again: that books matter, that they are the truest means of telling and showing us to ourselves, that they do a strange, unaccountable, irreplaceable work that the loose, baggy monsters of film, TV and internet cannot," Le said.

He said he was "gobsmacked" at being selected as the winner.

Drawing the Global Colour Line looks at how white racial policies that evolved in the late 19th and early 20th centuries shaped Australia.

"We began with the idea that it would be mainly about Australia, but the ideas led off to many other countries," Reynolds said on accepting his award.

House of Exile is the story of author and activist Heinrich Mann and his partner, Nelly Kroeger, who fled Nazi Germany in 1933, finding refuge first in France and later in Los Angeles.

Juer said the work took more than 10 years of painstaking research and writing.

The prizes were awarded Sunday in Sydney.

With files from the Australian Broadcasting Corp.