Directors Steven Spielberg and George Lucas, and actors Harrison Ford, Andy Garcia and Mike Myers were among the stars who cheered on the legendary actor Thursday at the ceremony at the Kodak Theatre.
Myers wore a tuxedo jacket and a kilt to honor the Scottish actor.
"Men want to be him, women want him, and in my case I both want to be him and want him," Myers joked.
"He's extremely professional, very talented and has an amazingly strong presence on the screen," Lucas said from the red carpet.
Connery thanked the audience for "one hell of an evening."
"I got my big break when I was five years old, and it's taken more than 70 years to realize it," he said. "At five I learned to read, and I would not be standing here without the books, plays and scripts."
Connery was launched to stardom in the 1960s and 1970s, playing agent 007, or "Bond, James Bond," as he introduced himself to foes.
He also starred in "Indiana Jones and the Last Crusade," "The Hunt for Red October" and "The Untouchables," which earned him an Oscar for best supporting actor.
He is the 34th recipient of the award, the Institute's highest honor for a career in film.
Past recipients include Orson Welles, Bette Davis, Alfred Hitchcock, Sidney Poitier, Elizabeth Taylor, Jack Nicholson, Steven Spielberg, Clint Eastwood, Martin Scorsese, Robert DeNiro, Meryl Streep and George Lucas.