Prince Walid, one of the world's richest men, inked the deal for the "flying palace" at a ceremony with executives from the European aircraft manufacturer at the Dubai air show.
The purchase price was not revealed, but the mammoth plane has a catalogue price of 320 million dollars.
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It will be delivered to Prince Walid in 2010.
Airbus sales chief John Leahy said he expected the airline to receive further orders from wealthy individuals in the oil-rich region for the super jumbo.
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At least 20 private VIP customers around the world are said to be interested in buying the A380, with a large number of them in the Middle East.
The prince, who owns the Dubai-listed Kingdom Hotel Investments, has a taste for luxury.
He owns some of the most prestigious hotels in the world -- the George V in Paris, the Plaza in New York, the Savoy and Four Seasons in London, and the Nile Plaza Four Seasons in Cairo.
He is also an arch defender of women's rights in Saudi Arabia, an ultra-conservative coun