The 39-year-old singer belted out the late, great Whitney Houston's classic hit in honour of the 76-year-old country music legend, who hosted the ceremony at Las Vegas' Allegiant Stadium on Monday night (07.03.22).
Afterwards, Dolly - who received a standing ovation from the packed crowd - said: "I know that Whitney is smiling down on us tonight, so thank you very much - she would be proud of that.
"I was backstage trying not to cry my false eyelashes off - slinging snot in every direction and tears. But anyway, that was an amazing job!"
Kelly revealed on her show last month that she was planning to pay tribute to Dolly at the event.
She said at the time: "I love her so much."
'Jolene' hitmaker Dolly dedicated the spectacle to the people of Ukraine amid Russia's invasion of the country.
As she opened the ceremony, she said: "I love to laugh, I love to joke, and we're going to have a good time tonight, but I do want us before we get started with all our fun to take a serious moment.
"Now I don't want to be political and this is not. I'd rather pass a kidney stone than do that, but I want us to send our love and hope to our brothers and sisters in Ukraine.
"So why don't we just dedicate this entire show to them and pray for peace around this crazy old world?"
During the event, Miranda Lambert, Carly Pearce and Lainey Wilson were the big winners on the night, each scooping two prizes.
Miranda won the coveted Entertainer of the Year prize and she also scooped the Video of the Year accolade for her and Elle King's accompaniment to song 'Drunk (And I Don't Wanna Go Home)'.
She told the crowd: "Oh my gosh, I cannot believe I'm not there to celebrate.
"This is my first time missing the ACMs in 17 years.
"My heart is a little broken, but I'm happy to be where I am. I've been waiting for this for a really, really long time."
Carly Pearce won the Female Artist of the Year, and she also picked up the Music Event of the Year prize for 'Never Wanted to Be That Girl' alongside Ashley McBryde.
Lainey Wilson took home both Song of the Year for 'Things a Man Oughta Know', and New Female Artist of the Year.
What's more, Chris Stapleton won the Male Artist of the Year accolade, Brothers Osborne scooped Duo of the Year, and Old Dominion took home Group of the Year.
ACM Awards 2022 full list of winners:
Entertainer of the Year
Female Artist of the Year
Male Artist of the Year
Album of the Year
Morgan Wallen - 'Dangerous: The Double Album'
Single of the Year
'If I Didn't Love You' - Jason Aldean and Carrie Underwood
Song of the Year
'Things a Man Oughta Know' - Lainey Wilson
New Female Artist of the Year
New Male Artist of the Year
Duo of the Year
Group of the Year
Video of the Year
'Drunk (And I Don't Wanna Go Home)' - Elle King and Miranda Lambert
Songwriter of the Year
Music Event of the Year
'Never Wanted to Be That Girl' - Carly Pearce and Ashley McBryde
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