In an unexpected decision, the BOJ eased monetary policy on worries that lower oil prices would affect consumer prices.
The central bank will increase the pace at which it expands base money to 80 trillion yen ($726bn; Â£454bn) a year, instead of 60-70 trillion yen.
The benchmark Nikkei 225 index closed up 4.8% at 16,413.76 after the news.
It had hit a seven-year high of 16,455.84 in mid-afternoon trade after rising by more than 5%. The dollar rose 1.2% to 110.68 yen, the highest since January 2008.
Several pieces of data out of Japan in the morning showing a weaker economy also failed to dent investor sentiment.
The country's annual core consumer inflation eased for a second straight month in September, while its jobless rate rose in the same period. Household spending also fell more than expected last month, adding to evidence that the central bank would probably maintain its massive stimulus programme.
Asian shares, meanwhile, were already up after positive economic data from the US showed strength in the world's largest economy.
Data showed the US economy grew at an annual rate of 3.5% in the third quarter. The news came a day after the Federal Reserve announced the end of its monetary stimulus programme.
Greater China shares followed the uptrend, with Hong Kong's Hang Seng index closing up 1.25% at 23,998.06 points.
On the mainland, the Shanghai Composite closed up 1.3% at 2,420.9 points.
In Australia, the benchmark S&P/ASX 200 closed up 0.9% at 5,526.60 points, following Wall Street's gains overnight.
Shares in heavyweight miners BHP Billiton and Rio Tinto rose 0.8% and 1.8% respectively.
In South Korea, the Kospi was up 0.3% at 1,964.43 points.
Japan led Asian shares higher after the Bank of Japan (BOJ) surprised markets by announcing more stimulus measures.