The incident at Parey secondary school, in the country’s impoverished eastern state of Saxony-Anhalt, followed a series of neo-Nazi attacks in the region.

Armin Friedrichs, Parey’s police chief, said: “Never in my long experience have I known such a terrible act against a teenager.”

The 16-year-old boy, who cannot be identified, was threatened with violence by classmates unless he walked around the playground carrying the placard which read: “I am the biggest pig in this place because I hang around with Jews.” The sign’s language was reminiscent of that used in the Nazi era when those who befriended Jews were humiliated.

Teachers spotted the boy and contacted the police. The teenager was known to have ties to the local left-wing youth scene and it is thought he had angered neo-Nazi classmates when he turned up wearing the far-right uniform of a shaved head and lace-up boots.

Three male pupils aged 15 and 16 were detained for questioning and are now being investigated for possible charges of sedition, illegal insult and an assault charge of forcing the boy to act against his will.

Holger Hoevelmann, Saxony-Anhalt’s interior minister, called the incident repulsive.

He said: “People were humiliated in this manner by Nazi party storm troopers during their years in power. It is shattering to think such a thing could happen again to someone growing up now.”

The incident comes after racist attacks in eastern Germany threatened to blight the country’s hosting of the World Cup.

Figures from Germany’s Office for the Protection of the Constitution show that people are 12 times as likely to be victims of racist attacks in Saxony-Anhalt than in the similar-sized state of Hessen in the west of the country.

High unemployment in the east has been cited as a reason - over 20 per cent in some places.