It was the first time in three years that the US president has dropped to second place on the magazine's list and came as US-Russia relations slid to a new low.
Putin, who has enjoyed 12 years of dominant rule over Russia, was again elected president in April.
Obama, on the other hand, has just emerged scathed from an embarrassing 16-day US government shutdown caused by a budget and debt crisis in Washington.
"Putin has solidified his control over Russia, while Obama's lame duck period has seemingly set in earlier than usual for a two-term president -- latest example: the government shutdown mess," wrote Forbes.
A month later, Putin played the trump card again by averting Obama's threatened missile strikes on Syria with a plan for Damascus to hand over chemical weapons.
"Anyone watching this year's chess match over Syria and NSA leaks has a clear idea of the shifting individual power dynamics," Forbes wrote.
The 2013 list of 72 powerbrokers was chosen to reflect one for every 100 million lesser mortals on Earth.
Third prize went to Chinese President Xi Jinping, who is expected to rule for a decade in which China is set to eclipse the US as the world's largest economy.
Pope Francis made his debut at number four and German Chancellor Angela Merkel rounded out the top five.
Among 13 newcomers were Samsung Chairman Lee Kun-Hee at number 41 and Nigerian billionaire Aliko Dangote, the richest man in Africa, in at number 64.
There were 17 heads of state who run nations with a combined GDP of $48 trillion and 27 CEOs and chairs who control over $3 trillion in annual revenues.
Only nine women made the cut despite representing half the world's population.