The man, named in French media reports as Didier Andrieux, commander of a unit of 400 officers and previously given the country’s Legion d’Honneur award, was filmed punching the demonstrator in the city of Toulon on Saturday.
He can be seen pushing him against the bonnet of a car and lashing out at a second demonstrator who approaches him.
Mr Andrieux told Var-Matin the video should be taken “in context” and said the blows “correspond to the arrest of a man who was rebelling”.
In further footage posted on Twitter, he can be seen throwing several punches at a man who was being held against a wall by other officers. The man was not wearing a yellow vest.
Other officers then intervene and separate the pair.
Mr Andrieux said he punched the second man to force him to drop a shard of broken glass he was holding.
“I then gave him two more blows because I didn’t know if he had dropped the shard,” he told the Var-Matin newspaper.
He described the man as a “chronic offender who has nothing to do with the ‘yellow vests’”.
After the videos were shared widely on social media France‘s Inspection Generale de la Police Nationale (IGPN) said it would investigate.
But Toulon's public prosecutor, Bernard Marchal, said Mr Andrieux had "acted proportionately" given the violence taking place around him, Liberation reported.
Activists clashed with police during the eighth weekend of gilet jaunes demonstrations on Saturday.
The movement, which began in November in protest against the government raising fuel tax and the high cost of living, has morphed into criticism of French president Emmanuel Macron and the country’s institutions.
On Sunday evening, Mr Macron wrote on Twitter: ”Once again, the Republic was attacked with extreme violence – its guardians, its representatives, its symbols.”
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