"Paul Grüninger should be an example to us all," said Fredy Fässler, police and justice chief in the canton of Saint Gallen at a commemoration for the late officer.
Grüninger's 92-year-old daughter Ruth Roduner unveiled a plaque in his honour at Saint Gallen police headquarters.
Between 1919 and 1939 Grüninger was the police commander in the Saint Gallen canton, which borders Austria.
After the Nazis came to power in Germany in 1933, thousands of Jews and political refugees began to flee abroad, including to Austria, which was in turn taken over by its northern neighbour in 1938.
Grüninger issued Swiss entry documents to between 2,000 and 3,000 Jews who entered illegally from Austria between 1937 and 1939.
Neutral Switzerland, which already had a tough immigration policy, beefed up its rules in 1939.
The government decided only to admit refugees who were deemed to be victims of political persecution, rather than those targeted on grounds of race or religion, thereby excluding Jews.
But Grüninger ignored the order and forged the dates on their entry documents to make it appear they had arrived earlier, and also helped them find housing.
After being found out, he was tried in 1940 and dishonourably discharged from the police.
His public humiliation left him unable to get regular work, and he eked out a meagre living without his police pension.
He died in 1972 at the age of 81, a year after Israel's Yad Vashem Holocaust memorial authority declared him one of the "righteous among the nations", a title bestowed on those who saved Jews.
"Grüninger paid a high price for the choice he made. In the struggle between his sense of duty as a police officer, and dedication to the concepts of humanity, the latter triumphed," Yad Vashem says in its website entry on his case.
Grüninger's name was cleared by a St Gallen court in the 1990s, but his memory had not previously been honoured officially by the cantonal police.