The ceremony took place ahead of the release of his latest film, "Beetlejuice Beetlejuice," this weekend. Winona Ryder, who appeared in the 1988 "Beetlejuice" film alongside Michael Keaton, attended the ceremony. Keaton and Danny DeVito were also there.
Ryder and Keaton praised Burton for his inclusiveness and ability to think outside the box.
"When I met you, I was a weird kid...You make being a weird girl not just OK, but something to celebrate and even kind of cool," Ryder said at the ceremony.
Fans couldn't wait to slip on a costume from their favorite Burton flick for the occasion.
"I did a mash-up of my two favorite characters. I did Lydia mixed with a little Mrs. Lovett and he did Beetlejuice," said fan Amber Martin from L.A.
Burton's star is appropriately located in front of Hollywood Toys & Costumes on Hollywood Boulevard - a place that holds special meaning to the filmmaker.
"It's beautiful. Like I said, I've been coming since I was a child, ever since I've been walking the streets of Hollywood when I was a little boy, coming to this toy shop, which is still here, which is incredible. So to have this in front of this place makes it extra special," Burton said.
The store dedicated a whole wall of costumes and toys in appreciation of Burton's art.
"Just imagining how our store played some kind of role in expanding his imagination and possibly inspiring him in the formative years of his early career is something that is so personal to us," said Natalie Moazzez, CEO of Hollywood Toys & Costumes.
"The store hasn't changed at all. In fact, I've already bought three Halloween masks," Burton said.
The Burbank native has written, directed and produced a slew of iconic films in a variety of genres, such as 1989's "Batman," "Edward Scissorhands" - and several stop-motion animation films like "The Nightmare Before Christmas" and "Corpse Bride."