The team were 5,000/1 to win the title before the start of the season last August.
Bookmakers are now reportedly set to lose more than £25 million - a record amount - as they pay out winnings of up to £100,000 on the unbelievable win.
Leicester City were crowned Barclays Premier League champions after Tottenham drew 2-2 at Chelsea on Monday, prompting scenes of joy and an all-night party.
The odds of them winning pre-season were worse than those of Elvis still being alive, and Simon Cowell becoming the Prime Minister of the UK.
Actor Tom Hanks is among those who bet on the team to win the title.
William Hill said its largest bet placed on the 5,000/1 odds was a £20 wager in Manchester - meaning that pundit will receive £100,000 in winnings.
The payouts will break the record for the biggest loss in British sporting history, according to The Independent.
They are worth nearly half of what Leicester spent on its entire football squad this season.
More betting odds have been released this morning after joy erupted around Leicester, including 1000/1 for Leicester City player Jamie Vardy to win Time Person of the Year, and 50/1 for him to be knighted.
The 5000/1 bet was the biggest ever landed in bookmaking history, according to WilliamHill. It is paying out more than £3 million, including one £75 bet which wins £112,500, and a 5p bet which means its Edinburgh-based customer will collect £250.
Its previous 'longest-odds' payouts were 2500/1 for grandfather Pete Edwards, who won £125,000 by backing his grandson Harry Wilson to play football for Wales.
David Threlfall also won £10,000 in 1969 on 1,000/1 odds that a man would walk on the moon before 1970.
"Leicester's 5000/1 victory has smashed all bookmaking records and in the process cost us a £2.2m loss - our worst individual day's result on a single sport since Frankie Dettori rode all seven winners at Ascot in September 1996 and cost us over £8m and the industry £50m," said William Hill spokesman Graham Sharpe.
These 9 things were officially more likely to happen than Leicester winning the Premiership:
- Simon Cowell becoming Prime MinisterRich Fury/Invision/AP
- Jeremy Corbyn winning Big BrotherChris Ratcliffe via Getty Images
- Aliens being found by 2017Donald Iain Smith via Getty Images
- Kim Kardashian West becoming US presidentCharles Sykes/Invision/AP
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- Dean Gaffney winning a Best Actor OscarMark Cuthbert via Getty Images
- Elvis still being aliveAP
- Alex Ferguson winning Strictly Come DancingRichard Sellers/EMPICS Sport
- Nick Grimshaw winning an Olympic Gold at RioDoug Peters/Doug Peters