Jackson, who had been expected to enjoy a clean sweep, ended up with four awards. He and Swift went head-to-head in the artist of the year race, the ceremony's final prize.
Other multiple winners included hip-hop acts Jay-Z and the Black Eyed Peas, with two each.
Swift, 19, was also named favorite female artist in the pop/rock and country categories, and favorite adult-contemporary artist. Her 2008 album "Fearless," the best-selling release in the United States this year, was named favorite country album.
"Music has never been ultimately about competition," Swift said, after winning the artist of the year prize. She said it was an "unimaginable honor" to be cited in the same category as Jackson, and thanked the Jackson family.
Jackson was named favorite male artist in the pop/rock and soul/R&B categories, while his 2003 hits collection "Number Ones" was named favorite album in both those categories. The album is the No. 2 seller this year in the United States.
His brother Jermaine, accompanied by sons Jeremy, Jaafar and Jermajesty, accepted on his behalf. At one point, he thanked Allah "for blessing my entire family."
Rapper Eminem, making a rare awards-show appearance in the wake of his four nominations, went home empty-handed. Glam-pop singer Lady Gaga, rock band Kings of Leon and jailed rapper T.I., who earned three nominations each, were also snubbed.
The Black Eyed Peas were named favorite group in both the pop/rock and soul/R&B categories. Jay-Z won favorite male artist and favorite album in the rap/hip-hop categories. His wife Beyonce, who was performing a show in Dublin, was named favorite female artist in the soul/R&B category.
Punk rock trio Green Day won the favorite alternative artist. Rascal Flatts won favorite country group for the fourth year in a row.
The performance-heavy show included some notable scenes. Openly gay "American Idol" runner-up Adam Lambert kissed a keyboardist of indeterminate gender and rubbed a male dancer's face in his crotch. Jennifer Lopez, meanwhile, landed on her bottom after jumping off the arched back of one of her dancers.
Nominees are determined by radio airplay and retail sales, while members of the public determine the winners through online voting. That's why Jackson got so many nominations, even though he didn't release any new material.
(Editing by Todd Eastham and Philip Barbara)
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