"The Girl with the Needle", starring Vic Carmen Sonne and Trine Dyrholm in the leading roles, takes place in Copenhagen at the end of World War I and follows the young poor factory worker Karoline who tries to make ends meet after becoming pregnant.
The film was selected for the main competition at the Cannes Film Festival in May and received good reviews, but has not yet had its Swedish cinema premiere.
Each country gets to select one film for the category of best international film. Then, it is finally five films that are nominated by the film academy in Hollywood for the gala in Los Angeles on March 2.
40-year-old Magnus von Horn was born in Sweden, educated at the Polish film school in Lodz, and now lives in Poland.
The Norwegian Film Institute also selected its Oscar candidate on Thursday. The choice fell on "Armand", directed by Halfdan Ullmann Tøndel.
Corrected: An earlier version contained an incorrect statement about von Horn's education.