The track has become a global phenomenon and the video featuring his famous horse-riding dance is YouTube's most "liked" of all time.
It entered the top 40 at number 37 two weeks ago, jumping to number three last Sunday.
Gangnam Style knocked The Script's Hall of Fame off top spot.
The Irish band are now at number two, with US rapper Flo Rider at number three with his single I Cry.
The highest new entry was DJ Fresh's The Feel at number 13.
Mumford & Sons' new album, Babel, has gone straight to the top of the UK album chart.
The band recently revealed that a song on Babel features a line "lifted completely" from Hilary Mantel's Wolf Hall.
The band's frontman, Marcus Mumford, admitted to being inspired by the Man Booker Prize-winning novel in an interview with BBC Radio 4's Front Row.
He said it was "definitely" a line spoken by central character Thomas Cromwell, but chose not to elaborate.
"I'm not going to tell you which, because I think it might be illegal."
Babel follows their 2009 award-winning debut, Sigh No More, which also re-entered the top 40 this week at number 10.
There is another new entry at number two, Green Day's Uno, the first of a trilogy of albums.
Opera duo Jonathan and Charlotte, who were contestants on the last series of Britain's Got Talent, debuted at number five on the chart with their album, Together.
No Doubt's first album in more than a decade entered the chart at number 16.
Push and Shove is the follow up to 2001's Rock Steady.
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