St Margaret of Scotland Hospice in Clydebank has been awarded five "excellent" ratings by Healthcare Improvement Scotland.
It is the first time the inspectors have given an independent hospice such a high rating with no recommendations for improvement.
The 58-bed hospice, Scotland's oldest and largest, was given the top rating in quality of care, environment, staff, management and information for patients and relatives.
Inspectors praised staff for involving patients and relatives in care plans and said workers spoke with "pride and passion" about the hospice.
Wards were described as "spacious, comfort-able and well main-tained". Comments from patients included, "Staff are totally dedicated to their patients. Physical and emotional wellbeing has been met in an exceptional way."
The hospice provides 30 specialist palliative care places and 28 continuing care beds as well as an outpatient service.
Last year, it was visited by the Queen.
Patients have access to a quiet lounge area, a prayer room, spa, therapy rooms, and there is accommodation for families.
The report states: "We found that people who used St Margaret of Scotland Hospice were complimentary about the service provided.
"People who used the service and their families were involved in identifying care needs and how they would like their care to be given.
"Staff were motivated and spoke with pride and passion about working in the hospice."
It comes after a difficult few years for the hospice which faced losing £1.2million of annual NHS funding for 30 continuing care beds.
NHS Greater Glasgow and Clyde was forced to make a U-turn following a long-running campaign by patients and relatives.
However campaigners claim the hospice still receives around 40% of the funding per bed which other hospices receive within the health board area.
Professor Leo Martin, chairman of the hospice's board of directors, said: "The findings of Healthcare Improvement Scotland are not a surprise to anyone who has been touched by St Margaret of Scotland Hospice.
"The findings reinforce the excellent management at the hospice and dedication of all of our staff."
Jean Anne Mitchell, who has direct experience with the hospice, has raised a petition calling for increased funding.
She said: "I believe that a comparison of funding shows that St Margaret of Scotland Hospice receives substantially less funding than the sector average.
"This requires to be addressed."