Un reporte de 700 páginas dice que unos 1,000 prisioneros de guerra y algunos 5,000 civiles fueron forzados a trabajar para los Nazis en favor de Alemania.
Estos fueron reclutados de 800 instituciones católicas del país.
La iglesia habia pagado $2 millones en compensación por trabajadores extranjeros que habian sido utilizados por los Nazis para labor forzada.
Iglesias protestantes del país han admitido también haber usado labor forzada durante la guerra.
Germany's Roman Catholic Church has acknowledged the extent of its involvement in the use of forced labour during World War II.
A 700-page report says 1,000 prisoners of war and some 5,000 civilians were forced to work for the Nazis in support of the German war effort.
They were drafted from 800 Catholic-run institutions across the country.
The Church had previously paid $2m in compensation to foreign workers who the Nazis had used for forced labour.
"It should not be concealed that the Catholic Church was blind for too long to the fate and suffering of men, women and children from the whole of Europe who were carted off to Germany as forced labourers," said Cardinal Karl Lehmann, the bishop of Mainz.
The cardinal - who stood down in January as head of the German bishops' conference - noted that the number of forced labourers used by the Church was a small fraction of the estimated 13m compelled to work by the Nazis.
At the televised launch of the report in Mainz, the cardinal said the conditions in which people had been forced to work in Catholic institutions - such as hospitals, homes and monastery gardens - had not been as bad as elsewhere.
The Protestant Church in Germany has admitted a similar use of forced labour during the Nazi era.
A number of leading German companies, such as Deutsche Bank, Volkswagen and Siemens have, in recent years, commissioned reports into their own dubious involvement.