Witney Town Council will receive a Government grant for sticking to a best value plan for its services.
It is one of just 41 smaller local authorities -- including town and parish councils -- throughout the country to receive the £45,000 award.
The only other authority in Oxfordshire to receive an award was Abingdon Town Council.
Witney town clerk Judy White said: "We've had to do a lot of work over the past three years to put this into action. It's good to see some sort of reward."
The Government's Best Value Scheme monitors the delivery and quality of services provided by councils.
It is aimed at the larger authorities, county and district councils, but towns and parishes with budgets of more than £500,000 a year are also included.
Witney and Abingdon are among the 8,700 parishes in the country covered by the scheme.
Checks are taken each year by the Audit Commission to ensure they are carrying out improvements.
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