Google Street View is a picture map, in which users can search for images of streets and buildings around the world.
"The defendants must make all faces and number plates unrecognisable before the pictures can be published on the Internet," said the Federal Administrative Court in a statement.
The court "concludes that the interest of the public in having a visual record and the commercial interests of the defendants in no way outweigh the rights over one's own image, as the pictures can be made more or totally unrecognisable, and this is a proportionate measure."
Street View allows users to take a ground level panoramic view of some locations on Google Maps, based on still photographs taken by specially equipped vehicles.
Switzerland's data protection commissioner Hanspeter Thuer had complained on several occasions that the service, introduced for Switzerland in 2009, flouted privacy rules.
In November 2009, Thuer announced that he was taking Google to court after the Internet firm refused to apply a majority of measures recommended on how images should be treated.
An appeal may be filed against the Federal Administrative Court's decision.