By Agence France-Presse
The 225-issue Nikkei jumped 1.60 percent, or 317.25 points, to close at 20,177.28, the first time it has crossed 20,000 since December 2015 and the highest since August that year.
The broader Topix index of all first-section shares gained 1.64 percent, or 26.06 points, to end at 1,612.20.
The strong showing followed a record close for all three main indexes on Wall Street in response to a better-than-expected jobs report.
Tokyo led Asian markets higher as the yen retreated against the dollar after payrolls firm ADP said the US economy created more than a quarter of a million jobs in May, boosting hopes for government figures later Friday.
"Tokyo simply took a lead from Wall Street as well as the brighter economic indicators," Hikaru Sato, a senior technical analyst at Daiwa Securities, told AFP.