Final answer:
The Beatles' album celebrated as a cultural milestone and a testament to the psychedelic counterculture is Sgt. Pepper's Lonely Hearts Club Band.
Step-by-step explanation:
The Beatles' album recognized as a cultural event and validation of the psychedelic counter-culture is D. Sgt. Pepper's Lonely Hearts Club Band. This album, released in 1967, was seminal in its representation of the era's burgeoning psychedelic music scene and countercultural movements.
Sgt. Pepper's was notable not only for its innovative studio techniques and musical diversity but also for its elaborate cover artwork, which reflected the aesthetic of the time and contributed to its role as a cultural milestone. It epitomized the youth rebellion, creativity, and the merging of art and music that defined the late 1960s.