The magazine cites Sugar Land's low cost of living and "high quality of life" to come to the ranking.
"Our selection as the top destination in the South is another indication that using revenue from tourism and commercial sources to reduce property taxes for our homeowners has been a successful strategy," said City Manager Allen Bogard in a news release. "We are proud that Money Magazine has recognized what we already know - Sugar Land is one of the country's premier destinations to live, work and play."
The city points to what it says is one of its strengths: the development of the Imperial Market, the 26-acre project that will include shops and other retail space and the Fort Bend Children's Discovery Center.
It's not the first time Sugar Land has landed on a Money "best of" list. In 2014, Sugar Land was named the best place to find a job.