The ranking is the highest ever for the 40-year-old Fijian, who takes over the second-ranked position from Ernie Els.
Tiger Woods, who is in danger of relinquishing the money title to Singh this year, stayed well ahead of the competition atop the rankings.
Els dropped to No. 3, marking the first time the South African has not been ranked second since January.
Davis Love III held onto the fourth spot while U.S. Open winner Jim Furyk stayed put at No. 5. Masters champion Mike Weir remained at No. 6.
David Toms, Kenny Perry, Padraig Harrington and Retief Goosen each held their positions from last week to round out the top 10.
Nick Price, who was inducted into the World Golf Hall of Fame last week, came in at No. 11 this week followed by Darren Clarke.
Phil Mickelson was 13th while Stuart Appleby held on to No. 14. Justin Leonard climbed two positions to No. 15 with Robert Allenby dropped one to No. 16.
K.J. Choi fell one spot to No. 17 followed by Brad Faxon, who moved up one rung to come in at No. 18 this week.
Paul Casey climbed two spaces to crack the top 20 at No. 19. Chris DiMarco was next at No. 20.
Ricardo Gonzalez, who earned his second career victory on the European Tour at the Telefonica Open de Madrid on Sunday, vaulted 54 spots to come in at No. 81 this week.