The director was handed the Against the Current award at the Off Camera film festival on Friday.
The 81-year-old, who grew up in the city during World War Two, said he was "extremely touched" by the honour.
He is due back in court in Krakow for another hearing on 22 May.
Polanski has been wanted by US police since 1977, when he fled the country fearing a lengthy jail sentence after being charged with having sex with a 13-year-old girl.
The Rosemary's Baby director was held in Switzerland in 2009 after travelling to Zurich to pick up a prize at another film festival, but the extradition bid failed and he was eventually allowed to return to his home in France.
1977: Polanski is charged in the US with the rape of a 13-year-old girl. He also faces charges of sodomy, child molestation and giving drugs to a minor.
1978: Fearing that he may face a lengthy jail term, Polanski flees to the UK and then to France. A citizen of France, he is protected by the country's limited extradition with the US.
2009: The US rejects Polanski's request for the case against him to be dismissed. On a visit to Switzerland later that year, he is at first imprisoned and then placed under house arrest, as the authorities consider a US extradition request.
2010: Swiss authorities decide against extraditing Polanski, freeing him from house arrest.
2014: Polanski is questioned by prosecutors in Poland, acting on a US request. He agrees to comply with the Polish justice system as it examines the matter.
2015: The director attends a hearing behind closed doors in February. He is due back in court on 22 May. If the US extradition request is approved the case will be passed to Poland's justice minister.
During Friday's ceremony at the festival, Polanski also pressed his palms into plaster for the hall of independent cinema stars.
"This is my city. Years spent in Krakow undoubtedly shaped my artistic soul," said the director, according to Hollywood Reporter.
Festival organisers said the Rosemary's Baby director "defies labelling" and has never followed fashion, according to Radio Poland.
"To American cinema he brought European doubts and non-compliance. To European cinema - American respect for the audience, discipline and professionalism."
Polanski has been to Poland several times in recent years and attended an extradition hearing there in February, which was held behind closed doors.
The BBC's Adam Easton in Warsaw said at the time that many believe the authorities will be reluctant to agree to the US extradition request, as Polanski is regarded as one of Poland's greatest living artists.
He plans to make his next film in the country - an adaptation of Robert Harris's thriller An Officer and a Spy.
Roman Polanski has been given one of Poland's top film awards in Krakow, where he is also facing a US extradition request over 1977 charges of having sex with a 13-year-old girl.