After deliberating six hours, the jury awarded Hogan $60 million for emotional distress and $55 million for economic damages.
"This is a victory for everyone who has had their privacy violated," Hogan's attorney, David Houston, said.
As the award was announced, the 62-year-old mustachioed wrestling icon cried and hugged Houston.
The case has drawn attention as a digital-age test of a celebrity's privacy rights and freedom of the press under the First Amendment of the U.S. Constitution.
Gawker publisher Nick Denton said the website would appeal the verdict. A Gawker attorney previously said a loss could put the website out of business.
"We all knew the appeals court will need to resolve the case," Denton said in a statement. "We feel very positive about the appeal that we have already begun preparing, as we expect to win this case ultimately."
The jury is to remain sequestered until Monday when it will consider punitive damages and other matters in the case.
Hulk Hogan, whose legal name is Terry Bollea, had sought $100 million in damages over the edited video that Gawker, a New York-based outlet known for gossip and media reporting, posted online in 2012.
The jury of two men and four women agreed with Hogan that his privacy had been violated, that the violation had caused him harm and that Hogan had a reasonable expectation of privacy.
Clay Calvert, a professor of law and mass communications at the University of Florida and a First Amendment expert, said such a large verdict was almost certain to be pared back on appeal, if not reversed.
"Juries generally do not like the media," he said after the verdict. "The appellate court is a little more neutral."
Gawker's one-minute, 41-second video depicted Hogan engaged in sex with the wife of his then-best friend, radio "shock jock" personality Bubba the Love Sponge Clem.
Hogan, a longtime star of World Wrestling Entertainment, said he did not know the consensual encounter had been recorded when it occurred nearly a decade ago in Bubba's home.
Gawker's video included excerpts from a 30-minute sex tape the company obtained without knowing its origin.
Hogan testified that he still suffers from the humiliation of a video that went viral. The video was viewed 2.5 million times on the Gawker site.
Hogan wore a signature black bandana during the two-week trial in St. Petersburg, Florida, near his home. Testimony touched on media ethics, website analytics and Hogan's statements about his sex life, including descriptions of his genitalia.
Gawker said the posting was in keeping with its mission to cover true and interesting subjects, stressing that Hogan had made his sex life a public matter.
Denton and the editor responsible for the post, A.J. Daulerio, were called as defense witnesses. Both were named in the lawsuit and they stood by the post, which Denton said "stands up to the test of time."