The flame started its first full day in London at the Prime Meridian in Greenwich, in the south east of the capital.
A carnival atmosphere spread through the streets of the Olympic borough as the rain of recent weeks gave way to brilliant sunshine and bands played for the crowds.
People of all ages and many nationalities turned out for the torch as the party mood took hold around the newly restored Cutty Sark clipper.
The torch began its London journey at the meridian, at Greenwich Royal Observatory, across the river Thames from Canary Wharf and overlooking the site of the Olympics' equestrian events.
Sir Robin Knox-Johnson, the first person to sail solo non-stop around the world, founder of the Clipper Round the World yacht race in 1995 and a Cutty Sark trustee, ran the torch around the clipper to delighted cheers from the crowds.
Crossing over the Thames, the torch will make its first move into east London before it arrives at the Olympic Stadium in Stratford next week.
It will be taken around the streets of host boroughs Newham, Tower Hamlets, Hackney and Waltham Forest, stopping off at Stepney Green Park, Hackney Town Hall and Leyton Cricket Ground.