During the war, Ida Grinspan, now 79, was deported to the Polish death camp in 1944 but was one of the few survivors to make it back to France.
She wrote a letter about her wartime experiences to children at a school in Parthenay, western France.
But when the town's deputy mayor, Michel Birault, a former policeman, found out she was to tell the children it was "gendarmes" who arrested her aged 14, it was censored.
Mayor Xavier Argenton then said she could only speak to the teenagers if she referred to the police simply as 'men'.
French media have now accused both men of trying to cover up France's shameful collaboration with the Nazis during World War Two.
During the war, French officials helped the SS round up tens of thousands of French Jews and take them to their deaths in the gas chambers.
Mr Argenton reportedly told Ms Grinspan: "We do not want to stigmatise a profession who were simply obeying the orders of the legitimate authority in those troubled times.
"This wording will do nothing to appease the resentments, and will sadly only bring them more to the fore."
Ms Grinspan agreed to the changes but said she never intended to offend anyone, rather "to simply give a true account of history."
Mr Argenton insisted he "never censured her or banned her speech."
"I said that it would be good to avoid stigmatising an entire profession, that we should avoid that word. I gave my opinion. I find it inappropriate to talk about censorship and I am astonished by the polemic this has caused," he added.