The pontiff held a huge open air Mass at the Vatican attended by up to 50,000 people before pushing open the bronze Holy Door of St Peter's Basilica.
Pilgrims gathered amid tight security with hundreds of police and soldiers deployed and a no fly zone imposed.
Police said there was no specific intelligence of a terror attack against the Vatican but the tiny state has been on high alert for several months.
During the Holy Year Catholics are encouraged to travel to Rome and religious sites around the world to pray.
The year is intended for people to think about the mercy they have received from God and how they can be merciful to others.
After opening the door Pope Francis said anyone passing through it must become a Good Samaritan.
Jubilee years are normally every 25 or 50 years but Pope Francis decided to call one early.
He had previously said the year would allow priests to absolve women who have had abortions, instead of the usual procedure, which requires a bishop's approval.
Peter Williams from the comment group Catholic Voices told Premier's News Hour the Pope will want to use the opportunity to reach out to those who have left the Church.
"I think that what he's looking for is for those that have been away from the Church for a while perhaps to be able to hear that the mercy that was always offered through the Church is going to be made even easier now to be able to access," he said.