Colon, who led the league with 21 wins, was listed first on 17 ballots and second on the other 11 for 118 points in voting by the Baseball Writers' Association of America. He was the only pitcher named on every ballot, easily beating out New York Yankees reliever Mariano Rivera, who received 68 points.
Dean Chance was the only other Cy Young Award winner in the Angels' 45-season history, winning in 1964.
Though Colon (21-8) was the league's only 20-game winner, this year's Cy Young race was thought to be close. His 3.48 ERA and 157 strikeouts ranked eighth, while Rivera racked up 43 saves and a career-best 1.38 ERA.
Santana went 16-7 with a 2.87 ERA and led the majors with 238 strikeouts.
Both Colon and Rivera pitched for division champions, but the voters ultimately gave more weight to the starter: Colon threw 222 2-3 innings to Rivera's 78 1-3.
Unfortunately for Los Angeles, Colon wasn't much help in the playoffs. He lost Game 1 to the Yankees in the first round, then left Game 5 of that series after only 23 pitches because of inflammation in his right shoulder.
The injured ace was left off the roster for the AL championship series against Chicago, and the Angels were eliminated in five games by the White Sox, who went on to a World Series sweep of Houston.
Voting for all BBWAA awards takes place at the end of the regular season and excludes postseason performance.
Colon gets a $500,000 bonus for winning the award — more than the entire salary of Lee, who made $345,000. Buehrle receives $60,000 for finishing fifth.