Wogan has an honorary doctorate from the University of Limerick, but failed to make it to the city’s recently-opened Hall of Fame.
City mayor Diarmuid Scully said the knighthood was well deserved.
“This is excellent and we are all delighted for Terry and his family,” said Mr Scully.
“It is a recognition of his tremendous work in broadcasting. We are very proud of him in Limerick and he has always been a great supporter of Limerick and keeps in touch with his old friends in the city.”
Dermot Cowhey, headmaster at Crescent College Comprehensive - where Sir Terry was a pupil up to 1954 - also welcomed the news.
“It is a great honour for our past pupil who went to Crescent when it was located in the old school building next to the Crescent church. Richard Harris is another past pupil as is Bill Whelan.”
Peter Power TD, who lives near the old Wogan home at 18 Elm Park, Ennis Road, said: “My father Gerry knew Terry well and this knighthood is recognition of his tremendous and enormous contribution to broadcasting.
“He went to England at a time when most Irishmen going there went to place block on block on building sites. Terry managed to conquer broadcasting.”