Concordia singled out Ismail Eskin as having made an outstanding contribution to freedom of information.
But the organisation said he would be unable to attend, saying it understood authorities believed he might seek asylum.
"Journalist Ismail Eskin, who was to receive our prize with a Turkish colleague in the name of jailed Turkish journalists... Has not received his visa," Concordia secretary general Astrid Zimmermann said.
"We are very annoyed that Ismail Eskin has not received his visa..." said Zimmermann. She added that Eskin's Turkish colleague Banu Guven would be able to attend the Vienna ceremony.
A foreign ministry spokesperson said Eskin had not in fact been refused a visa but that his case would take longer to process owing to incomplete paperwork.
Social Democratic lawmaker Hannes Jarolim said he found it "incomprehensible in this day and age that the Austrian embassy in Turkey should act without regard to the situation of countless jailed and threatened journalists" alluding to a widespread crackdown after last July's failed coup.
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