The magazine says the artist formerly known as Puff Daddy brought in $130 million (all figures US) from June 1, 2016, to June 1, 2017.
Forbes says Diddy's Bad Boy Family Reunion Tour, a stake in Ciroc vodka and the $70 million sale of one-third of his Sean John clothing line all contributed to his earnings.
No. 2 on the list is Beyoncé, with $105 million in earnings.
Harry Potter author J.K. Rowling brought in $95 million.
Rapper Drake ($94 million) and Portuguese soccer superstar Cristiano Ronaldo ($93 million) round out the top five.
Last year's top earner, Taylor Swift, dropped to No. 49. The singer brought in $44 million, down from $170 million.