Residents were shocked to see the flag, understood to have been a Nazi swastika banner, flying from one of the official flagpoles next to Vetlanda town hall in southern Sweden in the morning.
The local authority reported that a security guard had contacted council janitorial staff after discovering it at around 6am and that it had been taken down shortly thereafter.
When The Local contacted Vetlanda council's administrative manager Magnus Färjhage we were directed to a press statement already published on the authority's homepage.
“We take this very seriously. Vetlanda should be an open and welcoming council and these types of symbols are completely unacceptable to us. We're reporting it to the police,” Färjhage said in the statement.
It was not known by the afternoon who had hoisted the flag, but it was believed to have been intended to mark the birthday of German dictator Adolf Hitler, who was born on April 20th 1889. Last year a Nazi flag was raised at the Njudung school in Vetlanda on the same date.
“[This] is a clear assault on our open democracy and our fundamental values,” said the council executive committee's chairman Henrik Tvarnö of the Social Democrat party and deputy chairman Jan Johansson of local party Vetlanda Framåtanda in a joint statement.
Meanwhile, residents took to social media to voice their disgust after a picture purporting to be of the flag at the town hall was posted on Facebook.
“What a horrible affront to all people who have fallen victim to this dreadful ideology. Awful that the echo of history does not reach all residents in our little town,” commented one user under the picture, which was posted in the group 'You know you're from Vetlanda when'.
“Hope whoever has it now burns it,” wrote another one after it was removed.
Police meanwhile said they had launched an investigation into incitement of racial hatred.
It is not the first similar incident in Sweden recently. Last month a man who made Hitler salutes in Umeå was fined for inciting racial hatred. And earlier this year The Local reported that a Swedish Nazi group had tried to block the entrances to two schools in Örebro, with tape featuring their logo.
Far-right swordman Anton Lundin Pettersson who walked into a school in Trollhättan and stabbed three people to death in October last year had also expressed Nazi sympathies ahead of the attack.
Swedish anti-racist foundation Expo has said that neo-Nazi activities are growing in intensity in Sweden, although the organizations propelling far-right propaganda are declining in numbers.