The city has been discussing the action for several weeks.
Council members approved the decision Wednesday night after federal illegal immigration crackdowns allowed expanded ICE operations.
The Trump Administration is prioritizing enforcement on criminals, but Madera city leaders believe residents are becoming fearful of deportations.
The designation approval establishes the city's commitment to welcome and include all residents.
Madera officials acknowledge the city could face federal funding losses and legal action if the community is deemed a sanctuary city.