Iggy said he chose Sweet Leaf of the North by Armley-based band Mik Artistik's Ego Trip as his pick from the past ten years "because it's human, and it's real, and it has soul."
Lust for Life singer Iggy made the comments during a show on National Public Radio (NPR) in America.
Sweet Leaf of the North tells the story a leaf trapped behind the band's van's windscreen wiper during a trip to a gig London.
Iggy said on the radio programme: "Mik Artistik is not a household name. And in this track, he describes the experience of being a band from a poor northern town who is very excited that they're going to get in their van and drive to play in the big city."
Iggy said: "The song talks a lot about hope and reality. And although Mik is not a trained vocalist, he is accompanied by a very, very sensitive and tasteful guitarist. And it's very pleasant to listen to."
Iggy added: "There it is - my pick for best of the 2010s - because it's human, and it's real, and it has soul."
Iggy has played Mik's music on his Saturday night BBC 6 music show Iggy Confidential.
Mik, 64, is an artist and musician who has been doing portraits on paper bags for 30 years and did one self-portrait which went on display at the National Portrait Gallery around 15 years ago.
Mik, who describes his music as rock and roll stand-up comedy and free jazz, started the band in 2004 and writes and sings the songs while Jonny Flockton, 42, plays guitar.
The band has made around ten albums, are regulars performing at Glastonbury and are set play at the 50th event next summer.
They are currently touring the country promoting latest album More.
Mik said Burley Banksy Andy McVeigh is a fan of the band, as is renowned documentary photographer Martin Parr.
Mik said: "Martin Parr did an article in The Observer 'On My Radar' and said we were his favourite band.
"I think Iggy Pop must have read the article and checked us out.
"I wasn't expecting someone of Iggy Pop's stature to like my song. It was a surprise and a shock.
"I nearly burst into tears when I heard because I respect him as an artist."
Mik Artistik's Ego Trip are playing at the Brudenell Social Club in Hyde Park, Leeds, on Saturday December 21.
Tickets are available from Jumbo Records, Crash Records and the Brudenell.