The council also won Best Collaborative Working Initiative for its outstanding work with P3 West Midlands – a charity and social enterprise – on the initiative Working Together to End Rough Sleeping.
This initiative has seen homelessness figures in the city fall by 79% - from 33 in April 2018 to 7 in June 2019 – at a time when most areas are experiencing increases.
Councillor Ian Brookfield, Leader of the City of Wolverhampton Council, said: "We are proud to have been recognised by our peers and to receive these awards, but this isn’t just about the acknowledgment of awards, it’s about the hard work and commitment from staff resulting in excellent frontline services for our local people.
"The award for Best Collaborative Working Initiative is fantastic recognition of years of hard work and brilliant partnership working across our city to tackle a really tough issue, while to be named Council of the Year for Service Delivery is an incredible achievement and testament to the efforts of everyone involved; I couldn't be prouder of all our hard-working colleagues."
Three council teams were also finalists - the Waste Management and Recycling Service and Environmental Health, Trading Standards and Regulatory Service in the Best Service Team category, and WV Living in the Best Housing, Regeneration or New Build Initiative category.
The APSE awards recognise the best in local government frontline services across the UK.