The gold statuette was intended, instead, for Moonlight.
Talk about awkward.
The mix-up saw La La Land announced as the winner due to duplicate sets of cards - held by the only two people who knew the results - being mistakenly handed out to presenters Warren Beatty and Faye Dunaway.
The producers of La La Land were already wrapping up their acceptance speeches when it was revealed there had been an almighty gaffe and Moonlight had, in fact, won the top prize of the night.
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Host Jimmy Kimmel came forward to inform the cast of the mistake, showing the envelope as proof.
La La Land producer Jordan Horwitz then graciously passed his statue to the Moonlight producers.
Beatty returned to the microphone to say: “I want to tell you what happened I opened the envelope and it said Emma Stone, La La Land and that is why I took such a long look at Faye and at you.
“I wasn’t trying to be funny. This is Moonlight for best picture.”
Backstage, Stone revealed that she had been holding her winners card in her hand at the time the best picture winner was announced.
“Is that the craziest Oscar moment of all time?” she said. “Cool! It’s going to be history.”
Moonlight director Barry Jenkins said: “Very clearly even in my dreams this can’t be true. But to hell with dreams because this is true. It’s true, it’s not fake.”
PriceWaterhouseCooper, the accountancy firm responsible for counting the ballots, said in a statement: “We sincerely apologise to Moonlight, La La Land, Warren Beatty, Faye Dunaway, and Oscar viewers for the error that was made during the award announcement for best picture.
“The presenters had mistakenly been given the wrong category envelope and when discovered, was immediately corrected. We are currently investigating how this could have happened, and deeply regret that this occurred.”
La La Land, which had scored a record-tying 14 nominations, ended up with just six wins on the night, including best actress for Stone and best director for Damien Chazelle, who is the youngest winner of the prize at 32.
Manchester by the Sea won two awards - one of them was for best original screenplay.
The other was for Casey Affleck, who won the Oscar for best actor for his role as a grief-stricken janitor in the critically-acclaimed film.
See the full list of the 2017 Academy Award winners below.
Emma Stone (La La Land)
Casey Affleck (Manchester By The Sea)
Damien Chazelle (La La Land)
Best supporting actress
Viola Davis (Fences)
Best supporting actor
Mahershala Ali (Moonlight)
Best original screenplay
Kenneth Lonergan (Manchester By The Sea)
Best adapted screenplay
Barry Jenkins and Tarell Alvin McCraney (Moonlight)
Linus Sandgren (La La Land)
Best original score
Justin Hurwitz (La La Land)
Best original song
Justin Hurwitz, Benj Pasek and Justin Paul (La La Land)
Best sound editing
Sylvain Bellemare (Arrival)
Best foreign language film
Asghar Farhadi (The Salesman)
Best film editing
John Gilbert (Hacksaw Ridge)
Best visual effects
Robert Legato, Adam Valdez, Andrew R. Jones and Dan Lemmon (The Jungle Book)
Best production design
David Wasco and Sandy Reynolds Wasco (La La Land)
Best sound mixing
Kevin O’Connell, Andy Wright, Robert Mackenzie and Peter Grace (Hacksaw Ridge)
Best documentary Feature
Ezra Edelman and Caroline Waterlow (O.J.: Made in America)
Best animated film
Byron Howard, Rich Moore and Clark Spencer (Zootopia)
Best animated short film
Alan Barillaro and Marc Sondheimer (Piper)
Best documentary short subject
Orlando von Einsiedel and Joanna Natasegara (The White Helmets)
Best live action short film
Kristof Deak and Anna Udvardy (Sing)
Alessandro Bertolazzi, Giorgio Gregorini and Christopher Nelson (Suicide Squad)
Best costume design
Colleen Atwood (Fantastic Beast and Where To Find Them)