An Olympic games held in London in 2012 would have a "comprehensive and positive" environmental legacy, according to the International Olympic Committee (IOC) evaluation report.
The study praises London's approach, which is based on a "Towards a One Planet Olympics" concept.
In particular, it gives London top marks for its waste and energy management plans both at the proposed Olympic site in East London and across the capital.
"Comprehensive and positive environmental legacies for the community and the Olympic movement would be achieved from a London 2010 Olympic Games."
The report into the five candidate cities may form the basis of how IOC members cast their vote in Singapore next month to decide which city and country will host the games.
Bookies' frontrunner Paris was also highly praised for its environmental approach and its detailed plans for a sustainable games, although there was no mention of its waste management plans.
Other bidding cities are New York, Madrid and Moscow.