They qualified for the Summer Games in Paris - their first-ever appearance at the Olympics - as the best-placed team from Africa at the World Cup, after Egypt were beaten by New Zealand.
South Sudan, ranked 62nd in the world, played their first official international just six years ago in 2017.
"I'm speechless right now. To be quite honest, it's so surreal. We're going to the Olympics," South Sudan coach Royal Ivey told reporters through tears.
"This team is a beam of light. Like I keep on saying every postgame, we're bringing unity, camaraderie, love and friendship to this country," he said.
"This country has only been independent for 12 years. This is incredible. I take my hat off to my players because they trusted us from day one."
Carlik Jones, who plays for the NBA's Chicago Bulls, led the scoring for South Sudan on Saturday with 26 points and also had seven rebounds and 15 assists.
South Sudan, who were eliminated from title contention in the first round, beat hosts Philippines and China earlier in the tournament but suffered defeats at the hands of Puerto Rico and Serbia.
Previously South Sudan has only taken part in athletics events at the past two Olympic Games.
"We're going to the Olympics. Thank you to the people of South Sudan for staying with us, supporting us. This is a great feeling. I wish I could bottle this up right now," Ivey said.
Japan clinch spot
Japan claimed their place at the Paris Games with a nervy 80-71 win over Cape Verde in Okinawa.
Japan had not qualified for the Olympic basketball tournament except as hosts for 48 years, but their third win of the World Cup put them out of reach of their nearest Asian challengers.
They came from behind late to beat both Finland and Venezuela and head coach Tom Hovasse said they had "gained the respect of our opponents".
"I think we showed the world what we can do, and now we're on everybody's radar, we're on everybody's map," said the American, who led Japan's women's team to the Olympic silver medal in Tokyo two years ago.
"Gaining respect is a big step, winning games at this level is a huge step, so I'm really proud of what we did."
Japan took control against Cape Verde but suffered a late meltdown that almost cost them the game.
They conceded the first 13 points of the fourth quarter before they regained their composure to close out the win.
Hovasse said the fourth quarter was "hectic and could have been disastrous" but trusted his players to come through in the end.
Japan's win meant China were eliminated from Olympic qualifying contention before their game against the Philippines had even ended.
In the event, they lost 96-75 to the co-hosts for their fourth defeat of the tournament.
"Once you're tired, once the difficulties start, you have to use your head - our head was not used in the proper way tonight in the second half," said China head coach Aleksandar Djordjevic.
The highest-placed World Cup finishers from each of Asia, Africa and Oceania all qualify for Paris, along with the top two teams from both Europe and the Americas.
Australia have already claimed the Oceania berth, while France qualify automatically as hosts.
Four further spots at the 12-team Olympic competition will be up for grabs at next year's qualifying tournament.