Official statistics showed the number of Scots out of work - including those who are not eligible for benefits - dropped to 176,000 over the period September to November last year.
Meanwhile, the number of people in employment increased to 2,559,000 - a rise of 10,000 on the previous three months and 90,000 higher than the total 12 months ago.
There was also a fall in the number of people who were out of work and claiming jobseeker's allowance, with this standing at 113,800 in December - a drop of 1,900 on the previous month and 24,100 lower than the final month of 2012.
The unemployment rate in Scotland has now fallen to 6.4% rate, meaning it continues to be below the UK rate of 7.1%.
The employment rate north of the border also continues to be higher, at 72.7% compared to 72.1% for the UK as a whole.
Scottish Secretary Alistair Carmichael said: "It is extremely encouraging to see unemployment in Scotland at its lowest level in nearly five years and employment increasing by 90,000 over the past year.
"The number of people in work in Scotland is close to the record highs seen before the recession and there has been a big fall in in the number of people claiming jobseeker's allowance.
"Every new job created and every person getting back into work is to be welcomed."
He added the figures reflected "how well Scotland is doing as part of the UK", adding that the British economy was "growing faster than any of the major economies across Europe, which means more jobs for more people".
Mr Carmichael added: "We are taking the difficult and responsible decisions with Scotland's economy and it is clear that this Government's long-term economic plan is working.
"The rise in employment also shows that the confidence of businesses in Scotland is growing.
"It is important that we continue with our efforts and ensure that the economic recovery benefits businesses, individuals and families up and down the country."
The Scottish Government said the unemployment rate north of the border was now the lowest it had been since the period January to March 2009.
It also highlighted the largest recorded annual rise in female employment, with this up by 62,000 over the year to stand at 1,236,000 for the period September to November.
At the same time as the unemployment figures were released, Scottish Government statistics showed export sales had fallen by 2.2% in the third quarter of 2013, with Finance Secretary John Swinney stressing the economic recovery remained fragile.
Mr Swinney said the jobless figures provided "more positive news for the Scottish economy, with the number of people in employment in Scotland continuing to increase".
He stated: "Scotland has a higher employment rate and lower unemployment rate than England, Wales or Northern Ireland.
"Consistent increases in employment levels show that the policies of the Scottish Government to create jobs and boost the economy are making progress.
"But we know that many employers continue to face what are very challenging conditions, as we have seen from today's manufactured exports figures.
"Over the last 12 months, manufacturing is a sector that has seen growth but the recovery remains fragile as a result of European trading conditions and the Westminster Government's continued pursuit of austerity.
"With the limited powers over the economy that we have at our disposal, Scotland's economic health is improving, but without the full powers of independence we cannot secure the greater levels of growth and employment that we need.
"With the full fiscal and economic powers of independence, we can take a different approach to Westminster austerity and do more to strengthen our economy, boost our exports and create jobs."
Union leaders said the fall in the jobless total was welcome but stressed there was "no cause for complacency" in the statistics.
Scottish Trades Union Congress (STUC) general secretary Grahame Smith said: "Confirmation of a big fall in unemployment last autumn is a great way to start the new year.
"It's also encouraging that both women and men experienced falls in unemployment over the last quarter and that long-term unemployment is starting to fall across all age groups."
But he added there were "reasons to be cautious about the strength of the labour market recovery", saying: "The fall in unemployment this quarter is more attributable to people leaving the labour force than to people finding jobs.
"The increase in full-time jobs over the last year is also disappointing, with only 8,000 more created.
"Progress in tackling youth unemployment is painfully slow, with the 16-24 rate falling by only 0.9% over the year.
"The Scottish employment rate remains 4.1% below its peak of July 2008 and the unemployment rate 2.4% higher. Today's figures, while welcome, provide no cause for complacency".
Labour finance spokesman Iain Gray said while the new figures provided a "welcome boost", the Scottish Government must commit to further action.
But he said there was little in the SNP administration's budget plans "that supports job creation or growing our economy".
Mr Gray added: "We also need to be confident that these additional jobs are sustainable and will lead to increased consumer spending.
"However in amongst the figures there is likely to be a large proportion of jobs that are seasonal, temporary or part-time and we cannot depend on this as a long-term solution.
"We need to look behind the headlines and make sure the opportunities that are available are full-time and secure, and give people the scope to plan for their future and put our economy back to pre-recession levels."
Liberal Democrat leader Willie Rennie argued Scotland was "sharing in the benefits of the coalition government's long-term economic plan".
He added: "Taxes are down, pensions are up and today we learn that unemployment is at a five-year low.
"With Liberal Democrats in UK government, we are building a stronger economy which is enabling more people to get on in life."
Liz Cameron, chief executive of Scottish Chambers of Commerce, said: "Scottish businesses are gaining in confidence and creating new job opportunities, and that is why our unemployment rate has fallen to 6.4% - well below the UK average."
She said there was now "an increasing weight of evidence that the Scottish economy is at last entering a period of sustained growth and that GDP levels might soon return to their pre-recessionary mark".