The armed forces received the award, from Norway's Directorate of Integration and Diversity, for its decision to allow staff to wear the hijab, turbans, or skull caps on duty, and for serving halal food in its canteens.
"It goes against the Progress Party's manifesto, national congress resolutions and repeated decisions in the parliamentary group," Progress MP Christian Tybring-Gjedde told NRK. "We do not want these kind of religious symbols on neutral uniforms."
Solveig Horne, the Minister for Children and Equality, gave out the award at a ceremony on December 3rd at Oslo's Akerhus Fortress.
"The military has gone ahead and shown how progress can be made with diversity," she said in a speech. "I look forward to the results you achieve in the coming years as a result of the actions you have taken."
As well as allowing new recruits from immigrant backgrounds to wear religious symbols, the Norwegian armed forces has also decided to permit them to take time off for religious holidays.
Tybring-Gjedde's statement comes as more radical anti-immigration and anti-Islamic figures are losing influence in the Progress Party. Tybring-Gjedde resigned this month as leader of the party in Oslo, and Per Sandberg, another outspoken figure on the question of immigration, resigned as deputy leader last year.
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Tybring-Gjedde declined to say whether offering halal meat in military canteens was an example of "creeping Islamization", a formulation used controversially by the party's leader Siv Jensen in 2009.
"Whether you call it creeping Islamization or not, it is in any case very unnecessary, and it creates neither harmony, nor unity, nor anything else," he said.