The Order of Canada, the highest civilian honour in the country, recognizes a lifetime of outstanding achievement and dedication to community.
Governor General Michaëlle Jean presented Morgentaler with the honour at the Citadel. Morgentaler, 85, is among 20 Canadians who were to receive the award.
Abortion opponents had vowed to gather outside the Citadel to protest the decision to honour Morgentaler.
Morgentaler said immediately after the ceremony that he was "honoured" to receive the award.
"Canada is one of the few places in the world where freedom of speech and choice prevail in a truly democratic fashion. I am proud to have been given this opportunity, coming from war-torn Europe, to realize my potential and my dream," he said.
Morgentaler said his dream was "to create a better and more humane society."
Jean said in a speech at the ceremony that the Canadians honoured on Friday "represent the best in all of us" and have all "made and continue to make a difference in society."
She said the accomplishments of those who received the award show that "we must all take chances" and their accomplishments are an inspiration to Canadians.
"You have overcome every obstacle. You have dreamed big," she said. "You have strived to make the impossible a reality."
In a statement released Thursday by Rideau Hall, Jean said that Morgentaler has had "a major impact" on Canadian public policy.
"A Holocaust survivor, he has not hesitated to put himself at risk in his determined drive to increase health-care options for Canadian women," the statement reads.
"He has been a catalyst for change and important debate, influencing public policy nationwide. He has heightened awareness of women's reproductive health issues among medical professionals and the Canadian public."
Rideau Hall announced in July that it would bestow the award on Morgentaler, and some past recipients, angry at the decision, gave back their medals in protest, CBC reports.
Morgentaler said his efforts to legalize abortion in Canada mean Canadian women are not in danger when they do undergo the procedure to end an unwanted pregnancy.
The other Canadians who received the award on Friday included Louise Arbour, a former Supreme Court of Canada justice and UN High Commissioner for Human Rights; Larry Tanenbaum, chairman of Maple Leaf Sports and Entertainment; and Montreal fashion designer Simon Chang.
Morgentaler immigrated to Canada from Poland after the Second World War and opened a clinic in Montreal in 1969, where he performed thousands of what were then illegal abortions.
A family physician, Morgentaler argued that access to abortion was a basic human right and that women should not have to risk death in order to end their pregnancies. Morgentaler's clinics were often raided by police, and one in Toronto was firebombed.
Morgentaler was arrested several times and spent months in jail as he fought his case at all court levels in Canada.
In January 1988, the Supreme Court of Canada struck down Canada's abortion law, which required women who wanted an abortion to appeal to a three-doctor hospital abortion committee.