The George Cross medal, awarded posthumously to Australian prisoner-of-War Private Horace "Slim" Madden, has gone on display at the Australian War Memorial.
The AWM said this medal had been loaned anonymously and was now displayed in the Korea section of the Conflicts 1945 to Today galleries.
This was the highest medal awarded to any Australian during the Korean war which ran from 1950-53 and in which 14,087 served and 339 died.
The George Cross ranks immediately after the Victoria Cross and could be awarded to civilians as well as servicemen for acts of gallantry not in the face of the enemy.
Under the current Australian award system, the George Cross has now been replaced by the Cross of Valour.
Private Madden, 27, a member of 3RAR was captured by Chinese communist forces at the battle of Kapyong in April 24, 1951, one of 29 Australian POWs from the Korean conflict.
He died in captivity on November 6, 1951, as a result of malnutrition and mistreatment.
Private Madden resolutely rejected all enemy efforts to force him to collaborate, and his name and example became widely known among fellow prisoners. Many subsequently provided testimonials which led to the George Cross award.
The official medal citation says he remained cheerful and optimistic despite repeated beatings and deprivation of food. He was known to share his meagre supplies, purchased from Koreans, with other prisoners who were ill.
"It would have been apparent to Private Madden that to pursue this course must eventually result in his death," the citation says.
"This did not deter him, and for six months, although becoming progressively weaker, he remained undaunted in his resistance. He would in no way cooperate with the enemy.
"This gallant soldier's outstanding heroism was an inspiration to all his fellow prisoners."