The residents of Ballater, Aberdeenshire, collected 60 stones from hills in the surrounding area to create the display.
On a visit to the town yesterday, the Queen met Gordon Bruce and Alistair Cassie who came up with the idea for the commemorative work.
Hundreds of locals turned out to see the Queen who was presented with a bouquet by waiting children.
Mr Bruce, a retired builder, said: “We felt the royalty had done a lot for Ballater and we should do something for the Jubilee. We got kind permission to go on all the estates to collect the stones. The blacksmith and so on has done everything for nothing – the community spirit has been great.”
The crowds cheered and applauded as she reached the church and lifted a cover of Balmoral tartan to reveal the plaque, which lists the 30 hills the stones came from.
The rocks themselves are set within a bed of mixed heather next to the plaque and topped by a large stone inscribed with “Queen Elizabeth II” and “1952 Jubilee 2012”.
The main stone was unveiled by local schoolchildren Elise Smith, eight, and Jack O’Halloran, nine, who wore crowns they had made. They were the winners of a Jubilee day competition.
Jack said: “It was very exciting to meet the Queen. I hope she liked our crowns.”