"Baku's Court for Serious Crimes sentenced Khadija Ismayilova to seven and a half years in prison for economic crimes, including illegal entrepreneurship and tax evasion," her lawyer Fariz Namazly told AFP.
"We will appeal the illegal verdict," he added.
Considered Azerbaijan's most prominent critical journalist, Ismayilova, 39, served as bureau chief for the local service of the US-funded Radio Free Europe/Radio Liberty network between 2008 and 2010.
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Held in pre-trial detention since December, Ismayilova had denounced her prosecution as politically motivated and an attempt to stop her critical reporting.
In her final statement to the court on Monday, she said prosecutors and court officials had "resorted to more and more lies and fakery."
"They won't be able to force me to stay silent, even if they sentence me to 15 or 25 years," she vowed.
The journalist has fearlessly probed the alleged vast riches amassed by President Ilham Aliyev and his family.
Read: Record 18 journalists jailed in Egypt: watchdog
Her supporters say the charges against her have been concocted by a government anxious to silence one of the few voices of independent journalism in the oil-rich former Soviet country.
Rights groups accuse the government of Azerbaijan of stepping up pressure on opponents after Aliyev's reelection to a third term in 2013.
Read: Jailed abroad: Afghan authorities free Pakistani journalist
Earlier this month, Azerbaijan jailed a prominent rights activist couple to lengthy jail terms in a case that was also decried as politically motivated.
Aliyev, 53, strongly denies accusations of rights abuses, while his administration has dismissed such criticism as a smear campaign.
Aliyev took over after the death of his father Heydar Aliyev, a former KGB officer and communist-era leader who had ruled newly independent Azerbaijan with an iron fist since 1993.
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