The dog, first spotted by a bus driver who then alerted police in Belmont near the Vaud capital, has now been handed over to an animal shelter where it will be put up for adoption.
Michel Christin, of the Vaud society for the protection of animals (SVPA), told AFP that the poodle had managed to partially rip the rubbish bag open and had its head sticking out of a hole.
"I've never seen anything like this," he said.
"He's escaped an awful death because the rubbish dumpster compresses the bags."
The mistreated poodle is thought to be between five and six years old.
Christin said that although the animal was wearing an electronic collar when it was found, the dog has not been found in Swiss records.
The investigation has therefore now widened to also include other European countries.
Le Matin said the dog was "bathing in its own urine" while in the plastic bag that was tied.
It was a case of cruelty and "sadism" that Christin had never before seen in his 32-year career, he told the newspaper.
On Thursday, the dog was set for a proper clean-up.
"We've already received tons of name suggestions for him," Christin said.
The person responsible for abandoning the dog faces a fine of up to 20,000 francs (16,000 euros) or a prison sentence.
The SVPA said on its website that the poodle is doing well, although it is a bit frightened of its new surroundings.
The centre has received numerous calls from people who want to adopt the animal.
However, the centre said the dog would not be put up for adoption for some time while the investigation into where it came from continues.
The SVPA noted that it has no shortage of other animals seeking homes — it receives 1,000 dogs abandoned or put up for adoption every year.