In announcing the appointment of former Liberal Party (Folkpartiet) leader Bengt Westerberg to head the commission, Sweden's integration minister Erik Ullenhag emphasised, however, the inquiry does not amount to an investigation of the Sweden Democrats.
"This isn't an investigation about or against the Sweden Democrats, but the need to combat xenophobia has increased since the Sweden Democrats entered the Riksdag," Ullenhag said during a press conference.
"We have a common responsibility to see that the forces for good stand up for tolerance."
Westerberg welcomed the appointment, but added that the job that lay ahead was far from easy.
"I'm going to survey, among other things, xenophobia. But what is that? That's not an easy task. How many who are xenophobic depends on how one defines xenophobia," he said.
"It's not about some specific group. The problem exists within all of us. There is good and evil within us all. And that's what constitutes the great risk for a widening in society, that this potential exists in us all. The important question is how we can get the curiosity within us about what is foreign to overtake the evil."
Westerberg plans to collect the existing research about xenophobia and intolerant attitudes and why they exist, as well as identify the shortcomings found in current efforts to address the issue.
Much of the work is expected to focus on schools, which are seen as a central arena for implementing efforts to reduce intolerance.
Westerberg plans to look into how knowledge about intolerance and racism can be better applied in Swedish classrooms.
Björn Söder, spokesperson for the Sweden Democrats, slammed the government's inquiry.
"Expect indoctrination and propaganda against SD in our schools!" Söder wrote on his Twitter account in reference to the government's announcement.
But Ullenhag quickly rejected claims that the efforts amounted to indoctrination.
"School and society shouldn't be neutral when it comes to democracy and human rights," he said.
The commission is scheduled to present its findings in October 2012.