Last year Ronaldinho won the award for leading Barcelona to the Liga title.
The prize effectively lists the best players plying their trade on the continent, narrowed down from 50 by a pool of European journalists.
Cannavaro won with 173 votes, with Buffon trailing with 124 followed closely by Henry.
Ronaldinho comes fourth with 73, joined by Barca team-mate Samuel Eto'o in sixth with 67.
In between them is retired Zinedine Zidane, who amassed 71 votes.
The rest of the top ten reads Werder Bremen's Miroslav Klose, Didier Drogba of Chelsea, Milan's Andrea Pirlo and Arsenal goalkeeper Jens Lehmann.
There had been much speculation about the recipient in 2006, with Italy captain Cannavaro favourite for a while alongside Buffon and Henry and the maverick Brazilian Ronaldinho.
Some of the world's most influential ambassadors have had their say on where the award should end up.
The most prominent among these was Michel Platini, winner on three consecutive occasions in the eighties.
He claimed that the award would be given to an Italian solely because of that nation's World Cup triumph, and that Ronaldinho and Henry were more deserving.