The Washington-based research organization said that global wind capacity rose by over 27,000 megawatts (MW), or enough to power around 27 million homes, to some 120,798 MW last year.
Wind now provides 1.5 percent of the world's energy demand, up from 0.1 percent in 1997.
U.S. wind capacity increased by 50 percent to 25,170 MW, or 21 percent of world capacity.
In Europe, wind represented the leading source of new power capacity, with 8,877 MW installed last year.
This was 28 percent more than new natural gas capacity and over 10 times more than new coal, Worldwatch said.
Europe now generates 65,946 MW of wind power, or 55 percent of global capacity.
Germany still leads the region, generating 23,903 MW of wind power, but it saw new installations drop slightly in 2008.
In Asia, China ranked second globally in new capacity last year, adding some 6,300 MW to bring its total to over 12,200 MW.
The Chinese government has now surpassed its 2010 goal of 10,000 megawatts of installed wind power and a senior energy official said in April the country will have 100,000 MW in place by 2020.
Fang Junshi, head of the coal department of the National Energy Administration, told a conference in Beijing that China's annual wind power growth rate will be about 20 percent, enough to outpace fast-growing nuclear energy.
India added 1,800 in new wind, and now ranks fifth globally with capacity of 9,645 MW, Worldwatch said.