Blown Away, by Rob Biddulph, is only the second picture book to win the £5,000 prize in its 11-year history.
Biddulph’s story was named the year’s best illustrated book before going on to be named overall winner.
Two other titles won £2,000 each after winning awards for younger and teenage fiction respectively.
The award for best younger fiction went to Robin Stevens’ Murder Most Ladylike, in which two boarding school girls investigate the murder of a teacher.
Cambridge-based Stevens has already written a sequel, Arsenic for Tea, with a third instalment, First Class Murder, due out in July.
The best book for teenagers prize went to Sally Green’s Half Bad, the first part of a fantasy trilogy about warring clans of witches.
Green, a former accountant based in Warrington, published the second instalment, Half Wild, this week.
Biddulph, the Observer magazine’s art director, was recognised for his debut novel, as were Stevens and Green.
James Daunt, Waterstones’ managing director, said it was “particularly exciting” to see children’s books, his company’s “engine of sales growth… driven by debuts of such calibre”.