The Manila court found Maria Ressa, her online news site Rappler Inc and former reporter Reynaldo Santos Jr guilty of libeling a wealthy businessman.
Rappler's story on May 29, 2012, cited an unspecified intelligence report linking him to a murder, drug dealing, human trafficking and smuggling.
The site's lawyers disputed any malice and said the time limit for filing the libel complaint had passed.
Ressa was sentenced to up to six years but was not immediately taken into custody.
She posted bail for the case last year, and her lawyer said they will appeal the verdict.
Speaking at a news conference following the sentencing, Ressa questioned whether the country would lose freedom of the press to a "death by 1,000 cuts".
President Rodrigo Duterte and other Philippine officials have said the criminal complaints against Ressa and Rappler were not a press freedom issue but a part of normal judicial procedures arising from their alleged violations of the law.
Businessman Wilfredo Keng dismissed the allegations in the 2012 story as baseless and false and said Rappler refused to take down the story online and publish his side of the story.
He provided government certifications in court to show that he has no criminal record and sought 50 million pesos ($1 million) in damages, which he said he would donate if he won the case.
Rappler's lawyers said the story was based on an intelligence report and that the one-year period under Philippine penal law when a libel complaint can be filed had ended when Keng filed a lawsuit in 2017, five years after the story was published online.
A cybercrime law, which Rappler allegedly violated, was also enacted in September 2012 or four months after the story written by Santos was published.
Rappler's lawyers said Philippine penal laws cannot be retroactively applied.
Rappler, however, acknowledged that it updated the story in February 2014 to correct a misspelled word but said it did not make any other changes.
The Department of Justice, which brought the libel charges to court, contended that by updating the story, Rappler effectively republished the story online in 2014, an argument dismissed by the news site's lawyers.
The Department of Justice cited another law to say that a complaint can be filed under the 2012 cybercrime law for up to 12 years, countering Rappler's argument that Keng's complaint was invalid due to being outside the one-year deadline for libel.
If the Manila court upholds the Justice Department's position, journalists and media agencies can be sued up to 12 years after publishing a story.
As Rappler's chief executive officer, Ressa faces seven other criminal complaints in relation to legal issues hounding her news agency, including an allegation that it violated a constitutional ban on media agencies receiving foreign investment funds.
Ressa, who has worked for CNN and was one of Time magazine's Persons of the Year in 2018, has accused the government of abusing its power and of using the law to muzzle dissent.
