Donald, who was awarded an MBE, has topped the world rankings for 48 weeks - and the 34-year-old from Hemel Hempstead also achieved an unprecedented double when he topped the money lists on the European and American tours last season.
"I am truly honoured to be awarded an MBE by Her Majesty - particularly in her Jubilee year,'' Donald said during the US Open in San Francisco.
"Both 2011 and 2012 have been very significant years for me, both personally and professionally, and I am touched that my accomplishments have been recognised in this way.''
Paul Elliott, 48, receives a CBE for services to equality and diversity in
football - the highest honour so far received by any player from the Premier League era. Former England goalkeeper David James receives an MBE.
Elliot, whose clubs included Charlton, Celtic, Chelsea and Italian side Pisa, was also an ambassador and board member for England's bid for the 2018 World Cup.
Elliott, previously an MBE, said: "I am flabbergasted by this honour, and feel privileged and humbled.
"You do not set out in life to win these honours, I have just tried to make a
bit of a difference and I would like to thank organisations such as Kick It Out for all the work they have done.
"It will be a very proud moment for me when I receive the honour."
Tessa Jowell, the former Olympics minister who was instrumental in London bidding and winning the 2012 Games, is made a Dame, as is Zaha Hadid, the architect of the Olympic aquatics centre.
Rugby union player Shane Williams, Wales' all-time record try scorer, receives an MBE, as does Britain's leading showjumper Nick Skelton.
Skelton, 54, from Warwickshire, is still Britain's number one showjumper after making his national debut 33 years ago.
He recovered from breaking his neck in a fall in 2000 - it was touch and go whether he would survive - and is now aiming to win his first Olympic medal in London.
Skelton said: "I am very, very pleased and this is great for the sport of showjumping as well. It is a real honour.
"It has come at a good time just before the Olympics, so it will be nice if I
can get another medal this summer - time will tell.''
A CBE goes to Peter Keen, who this year stepped down as performance director of UK Sport after spearheading the funding strategy that saw Britain finish fourth in the medals table at the Beijing Olympics - and expected to win even more medals in London this summer.
Veteran athletics coach Malcolm Arnold, still working for UK Athletics at the age of 72, is honoured with an OBE for a coaching career that started as far back as the 1968 Olympics.
Arnold said today: "It's so surprising, a real honour. It's pleasing but you
never really think about these things or expect them from doing your job, you just plod on and do your thing.''
UK Athletics chairman Ed Warner also receives an OBE - a reflection of his role in leading the successful bid for London to host the 2017 world athletics championships.
Warner said: "I was surprised and delighted to learn of the honour. I have hugely enjoyed the last five years, these are momentous times
for the sport and I'm very proud to be chairman leading up to 2017.''
Other honours include an OBE for Albert Woods, the vice-chairman of the British Olympic Association since 1999, and president of the European Canoe Association and British Canoe Union.
Woods, 63, said: "I don't get speechless very often but this is such an honour and I'm really flattered to receive it especially in the Queen's diamond jubilee year.
"I've had to keep pinching myself whether it's true or not.''
Terry Downes, the oldest surviving winner of a boxing world title, is a
recipient of the newly-restored British Empire Medal.
Downes, 76, beat USA's Paul Pender for world middleweight crown on July 11, 1961. Born in London, Downes' family emigrated to America where he served with the US Marines in the 1950s before returning to England and becoming a professional boxer, nicknamed The Paddington Express.
Another former world champion boxer, 34-year-old Alex Arthur from Edinburgh, receives an MBE.
An MBE also goes to Margaret Alphonsi, a star flanker for the Saracens and England women's rugby teams known as 'Maggie the Machine'.
Veteran karate coach Hamish Adam receives an MBE for services to his sport - he has been a karate coach for 40 years and was a member of the British team that won the world championships in 1975, the first team ever to defeat Japan. He was also national coach for 15 years.
Lorraine Deschamps, one of only two female level-four qualified referee tutors in the UK and an FA ambassador, receives an MBE for services to sport and diversity.
Archery's Alison Williamson, 40, who will become only the third person to
represent Great Britain in six consecutive Olympics at London 2012, receives an MBE.
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