The report, supported by Lloyds Bank, the Business Growth Fund and Cenkos Securities, is in its second year. Most of the companies more than doubled their revenue in the last four years, while the top 500 tripled theirs.
"These 1,000 exemplary businesses show how small and medium-sized businesses punch above their weight - more than doubling their revenue over the past four years to deliver growth and create jobs across the UK," business secretary Vince Cable said.
"The government is backing innovative and ambitious companies like these to grow and export their products all over the world and I wish them continued success for the future."
Inner London was named as home to the highest number of inspirational small and medium-sized businesses, with 171 such firms. It was way ahead of its closest competitors Greater Manchester (32) as well as Essex (29).
However, fast-growing small and medium-sized companies are appearing in all regions of the United Kingdom, with over 75 per cent being headquartered outside London.
Meanwhile, information technology, retail and real estate companies led Britain's fastest-growing small and medium-sized companies. In the four years to 2014, information technology sector revenue surged 350 per cent.
Technology is becoming an increasingly important part of the UK economy, with the internet economy contributing over 10 per cent to economic growth.
"Big data, the internet of things and cloud computing are examples of areas in which Britain’s digital industry is leading the way," Baroness Joanna Shields OBE, chief executive and chair, Tech City Investment Organisation, said.
"We have also become world class in many verticals of the tech and digital economy, including fintech, digital advertising and marketing, data management and analytics, software development, e-commerce and media and entertainment."
And the sectors with the highest concentration of the "1,000 most inspirational companies" were manufacturing (123), construction (87) and financial services (70).
British manufacturing been lifted by an uptick in domestic demand, which has also boosted production levels. The sector was also lifted by investments in new facilities and machinery and an increasingly skilled workforce.
It's often said the UK is becoming a nation of start-ups, as the number of people who are self-employed rockets. However, fast-growing small and medium-sized businesses have also played an important part in this story.
The food and beverages sector created the most jobs (8.8 per cent), followed by information technology (8.6 per cent), and then manufacturing (7.6 per cent).
"Small and mid-sized businesses are the lifeblood of the UK economy," Tim Hinton, managing director, mid markets and small and medium-sized banking, Lloyds Bank said:
"The importance of small and medium-sized [firms] to the recovery is in creating jobs and helping the country to diversify."