Miss India Harnaaz Sandhu was crowned Miss Universe in the Israeli city of Eilat early Monday, with several contestants defying pressure to boycott in support of the Palestinians.
The 70th edition of the annual pageant, held in Israel for the first time, has also faced complications from the coronavirus pandemic.
Sandhu took the top prize in the Red Sea resort with Paraguay's Nadia Ferreira first runner-up and Miss South Africa Lalela Mswane taking the second runner-up spot.
South Africa's Ministry of Sports, Culture and Arts had urged its contestant to stay away from Eilat, citing "atrocities committed by Israel against Palestinians."
The call echoed Palestinian groups who pleaded with contestants to avoid the event.
The Palestinian Campaign for the Academic and Cultural Boycott of Israel wrote: "We urge all participants to withdraw, to avoid complicity in Israel's apartheid regime and its violation of Palestinian human rights."
The 80 contestants also included Miss Morocco Kawtar Benhalima and Miss Bahrain Manar Nadeem Deyani, whose majority Muslim nations normalised ties with Israel last year.
In an interview with AFP in Jerusalem late last month, the outgoing Miss Universe Andrea Meza, of Mexico, said the pageant should steer clear of politics.
"Miss Universe isn't a political movement, nor a religious one. It's about women and what they can offer."
Muslim-majority Indonesia and Malaysia, nations that do not have diplomatic relations with Israel, have not sent contestants but both cited complications related to the pandemic, not Israel's rights record.
The United Arab Emirates, which also normalised ties with Israel last year and where Prime Minister Naftali Bennett made a historic visit Sunday, has also not sent a candidate.
But the UAE said that was "due to time constraints," in selecting its national winner.
Contestants for the pageant landed in Israel late last month and have since toured sites, sometimes coming under criticism for cultural insensitivity.
In one stop in the Bedouin city of Rahat, the candidates wore robes with traditional Palestinian embroidery while rolling grape leaves -- which Miss Philippines Beatrice Luigi Gomez tweeted was a "Day in the life of a Bedouin."
The Bedouin are a traditionally nomadic people who belong to the community of Palestinian citizens of Israel. They have long complained of discrimination in housing and education.
"Colonialism, racism, cultural appropriation, patriarchy, whitewashing, all in one place," tweeted Ines Abdel Razek of the advocacy group the Palestine Institute for Public Diplomacy.
Participants in the pageant, which was co-owned by Donald Trump before he became US president, must be between the ages of 18 and 28 and may never have married or had a child.
According to organisers, the coronation ceremony will be watched by 600 million viewers in 172 countries.