The 80-minute show opened at May Day Stadium Monday night, according to the Korean Central Broadcasting Station monitored by South Korea's Yonhap news agency.
It said this year's show has added new scenes to highlight the country's campaign to build a "strong, prosperous and powerful nation."
The stadium was packed with soldiers and workers as well as diplomats, international agency representatives, tourists and Koreans living abroad, it said.
The annual festival named after a famous Korean folk song began in 2002 to mark the 90th anniversary of the birth of founding president Kim Il-Sung.
It involves some 100,000 people, many of them schoolchildren, in a display of synchronised acrobatics, gymnastics, dances and elaborate flip-card displays of highly politicised messages.
Official media earlier said the show will continue until late September.
North Korea did not host the show in 2003, 2004 and 2006 but gave no reason. It was severely hit by floods in some of those years.
The May 1 Stadium, with 150,000 seats, is the world's largest sports facility outside of Rio de Janeiro.