IT consultant Chris Norman, 62, received the Legion d'honneur from French President Francois Hollande, alongside three Americans, in Paris.
The passengers overpowered an armed suspected radical Islamist on a high-speed train bound for Paris on Friday.
Mr Hollande said the men "gave a lesson in courage, in will, and thus in hope", during a ceremony at the Elysee Palace.
French authorities are questioning the suspect, Moroccan national Ayoub El-Khazzani, 25.
Mr Norman had told a press conference he decided to act because he thought he was "probably going to die anyway".
"I'd rather die being active, trying to get him down, than simply sit in the corner and be shot," he said.
Speaking after the ceremony, Mr Norman, who lives in France, said: "I'm just amazed, and I really appreciate the honour I've been given, this recognition of what we did.
"But I really don't know whether I deserve it."
Mr Hollande said Mr Norman, and Americans Spencer Stone, Alek Skarlatos, and Anthony Sadler, showed "that faced with terror, we have the power to resist".
He told the four men the entire world admired their courage and "spirit of solidarity", adding they "must be an example for all, and a source of inspiration".
A spokesman for Number 10 said the prime minister had praised the "extraordinary courage" of the men, saying "the bravery of Mr Norman and the other passengers helped to prevent a terrible incident".
Mr Stone and Mr Skarlatos are members of the Air Force and the National Guard respectively.
They were travelling on the train from Amsterdam to Paris on Friday evening with their childhood friend Mr Sadler, who also helped to restrain the attacker.
The incident happened when a French passenger tried to enter a toilet on the train and encountered the gunman. He tried to overpower him and the gun was then fired.
A French-American passenger was injured by the bullet, and the American passengers intervened shortly afterward.
At a press conference at the US Embassy in Paris on Sunday, Mr Stone said: "We ran down, tackled him and hit the ground.
"Alek tackled him and grabbed the gun out of his hand while I put him in a chokehold. It seemed like he kept on pulling more weapons - left and right.
"He pulled out a handgun. Alek took that. He took out a box cutter and was jabbing at me with that. We let go and all three of us started punching him while he was in the middle of us.
"I was able to grab him again and choke him unconscious while Alek was hitting him in the head with the pistol or rifle."
Two other unnamed passengers will receive the honour at a later date.
A British man who helped foil a suspected terror attack on a train has been given France's top bravery honour.