The one-liner from Stewart Francis beat a joke by gagsmith and 2010 winner Tim Vine into second place.
Francis's winning joke was: "You know who really gives kids a bad name? Posh and Becks."
The Beckhams have often been mocked for their children's names, which are Brooklyn Joseph, Romeo James, Cruz David and Harper Seven.
On picking up Dave's fifth annual 'Funniest Joke of the Fringe' gong, Stewart told the channel: "1969 'West Mall Soccer Association's Most Valuable Player', and now this... thank you, Dave."
An elite panel of ten comedy critics made a shortlist after watching 60 different comedy performances, before 30 jokes were put to the public vote, where 3,000 comedy fans chose their favourite.
Read all 10 of the funniest jokes from the Edinburgh Fringe Festival 2012 in our picture gallery below:
Copyright: PA Images Martina Salvi/PA Wire