Sheeran's hit Shape Of You had held the title, but after scoring 562 million audio and video streams combined the 26-year-old Scottish singer has been awarded a special-edition matte black Number One award and inflatable crown by the Official Charts Company to mark its 70th anniversary.
Capaldi said: “I’m the streaming king in the UK on this particular song!
“I feel huge, I feel massive, I feel my loins expanding as I become more and more aware of the reality of my coronation as the king of music.
“Thank you. A very large accolade that I will now shoulder for the rest of my life, or until Ed Sheeran releases his next album.”
He added: “Ed’s a man who is like a brother to me, he’s been a mentor, he’s put his arm round me and said don’t worry everything’s going to be OK.
“He gave us the honour of supporting him on the closing shows of the Divide tour, he’s been nothing but kind and gracious and beautiful, a good friend in an ever-changing industry.
“So to Ed I say ‘Eat my s**t’! That’s what happens, nice guys finish last. You snooze you lose, kiddo. Keep up!”
Capaldi and Sheeran, 31, co-wrote track Pointless on the Someone You Loved’s upcoming album Broken By Desire To Be Heavenly Sent which is set for release on 19 May 2023.
Shape Of You and Perfect by Sheeran and Capaldi’s Someone You Loved are the only tracks to have exceeded 500m streams in total, according to Official Charts Company figures.
Capaldi's debut album, Divinely Uninspired to a Hellish Extent, was the biggest-selling UK release of both 2019 and 2020.
He recently joked it had taken him so long to release his second album because he is "horribly lazy".
He told crowds at a festival in 2022: "I just want to say now, I have no new music to play you.
“I rescheduled a lot of shows last year because I was like, ‘Guys, I need to finish my new album’. And I was supposed to do it, but I am horribly lazy.”
Watch: Ed Sheeran offered to collaborate with Lewis Capaldi under a secret identity