The SS Mendi was a steamship chartered by the British Government to carry hundreds of South African troops to fight in France.
But on February 21, 1917 off the Isle of Wight, it was struck by another ship and sunk with the loss of 646 lives.
Yesterday 50 people were present at the ceremony, held by the Hollybrook Memorial, which lists the names of those killed in the disaster.
The event was organised by the Friends of Delville Wood and the South African Legion for Military Veterans.
Organiser John McCabe, who represents both organisations, said: “The event has always had a very emotional impact among South Africans because it was a great loss of life at one time.
“With the centenary of the First World War this year we felt it was very important to hold the event to educate people about the importance of remembering the SS Mendi.”