A study of more than 26,000 men found that those who followed a vegan diet had a 35% lower risk of developing the disease than men who were not vegan.
People who identify as vegan avoid food that comes from animals including dairy products, meat and eggs.
The research was funded by the World Cancer Research Fund (WCRF).
During the study, a total of 1,079 cases of prostate cancer were identified among the group of 26,000 men.
Around 8% of the men studied said they followed a vegan diet.
The researchers, from Loma Linda University in California, found that men who followed a vegan diet had a "statistically significant protective association" with prostate cancer.
Professor Gary Fraser, who led the study, said: "This new research makes a significant step in linking a vegan diet to reduced prostate cancer risk.
"What we now need is more research into this area to determine to the extent a vegan diet could reduce the number of men developing this cancer."
Prostate cancer is the most common cancer in men in the UK with over 47,000 new cases each year. More than 10,000 UK men die from the disease each year.
Dr Panagiota Mitrou, director of research funding at the WCRF, said: "With prostate cancer being the most common cancer in men in the UK, prevention is key if we are to see a decrease in the number of men developing the disease.
"This exciting research has, for the first time, helped fill some vital gaps in our knowledge about eating patterns and the prevention of prostate cancer and could pave the way for future research.
"Although these results are exciting, more studies are needed to demonstrate the strength of the link between a vegan diet and reducing the risk of prostate cancer."
Jimmy Pierce, spokesman for the Vegan Society, added: "The evidence around the disease-preventative qualities of the vegan diet is now overwhelming. Time and again we are seeing new research showing the vegan diet to be significantly better for our health.
"Still lingering, however, is the perception that eating meat is macho, that it somehow enhances masculinity or virility. Yet it is killing thousands of men in the UK every year.
"Now is the time to reject this outdated notion and embrace plant-based living regardless of gender – for the animals and the planet as well as your health."