Aldi notched up record sales over the Christmas period after shoppers snapped up both luxury products and cut-price fruit and vegetables.
The German supermarket said total UK sales were more than 15% higher during December compared to the same month in 2015.
The budget chain's "specially selected" premium range saw sales rocket 27%, with Argentinian Malbec, mince pies and a 30 day aged roasting joint among the top-selling products.
UK chief executive Matthew Barnes used the group's trading update to take aim at upmarket rivals Waitrose and M&S.
He said: "The people of Britain were very clear on what they wanted on their dinner tables this Christmas - unbeatable value premium-quality products and the lowest prices on festive essentials.
"Sales of our premium specially selected range in particular surpassed expectations - a clear sign that more and more people are realising they can treat their families to products of a quality comparable to Waitrose and M&S at a fraction of the price by shopping with Aldi."
Aldi predicts sales of its specially selected lines will exceed £750 million in 2017, just over a decade after the range was launched.
The chain sold over 13.5 million bottles of wine, champagne and Prosecco during December and said a special promotion on fruit and veg sales also boosted sales.
The firm's "super 6" campaign, which reduced the price of six festive fruit and veg lines to just 19p in the two weeks before Christmas, saw it sell 4.5 million packets of carrots, two million packets of Brussels sprouts and two million packs of parsnips.
However, the group did not disclose its like-for-like sales for the period, a more widely used industry measure of performance.
Experts believe Britain's biggest supermarkets are expected to have fought back strongly in the battle for Christmas shoppers as sales momentum at rivals Aldi and Lidl slows and is largely driven by new store openings.
City analysts predict Tesco, Morrisons, Sainsbury's and Asda - the so-called big four - have all performed better than in previous years, when they have taken a hammering from Aldi and Lidl. They will report results in the coming weeks.
Last week Aldi upped the pressure on its rivals after announcing it will increase pay to at least £8.53 an hour and £9.75 in London from next month.
Aldi claimed its rate of pay will be the highest in the supermarket sector, beating closest rival Lidl's recently announced increase to £8.45 nationally from March.
Aldi is also recruiting 4,000 new permanent employees across stores and warehouses over 2017 as it looks to open around 70 new shops this year.