Patrick Smith, 70, said he wrestled two men to the ground and held a third after seeing a group of "15 to 18 men" getting out of a lorry on Friday.
However, Bedfordshire Police said the man he held in the back of his car near Dunstable was innocent.
"I'm not sorry for what I did," he said. "I did what I thought was right."
Police said six people were detained on suspicion of immigration offences and subsequently passed on to UK Border Force.
However, the man Mr Smith held "had not committed any offences".
Mr Smith, who was travelling to go shopping with his wife Christine, said getting the wrong man was "very embarrassing" but stood by his reasons for being suspicious.
"He was in the vicinity of the 18 that got out of the vehicle," he said. "He was in very poor condition, smelt bad, couldn't speak any English.
"I understand that he must have been quite annoyed," said the Caddington parish councillor.
"When one's got somebody who is believed to be an illegal, one does what one would believe to be correct," he said.
"It's regrettable, but under the same circumstances I'd do it again."
A spokesman for Bedfordshire Police said no action would be taken against Mr Smith, who "had been acting with good intention".
A parish councillor has refused to apologise to a man he detained and handed over to police, wrongly presuming he was an illegal immigrant.