Holywood received the accolade as part of the Medium Town category of the awards.
Councillor Andrew Muir said: “I am delighted that Holywood was awarded Runner Up status in the Medium Town Category at the Northern Ireland Best Kept Town 2012 Awards.
“Whilst I am naturally disappointed Holywood didn’t win this year, achieving Runner Up status against stiff competition is an amazing achievement. I warmly congratulate and thank everyone involved in keeping Holywood tidy and attractive.
“I look forward to working with everyone over the forthcoming months to deliver a tidy town which attracts even more people to live, work or visit.
“During these tough economic times it’s especially important we have a town which attracts investors.”