President John Kufuor has lit the independence flame to the cheering of the crowds decked in national colours.
More than 20 heads of state are attending the events, alongside popular figures including the footballer Pele.
Ghana was the first sub-Saharan country to break with colonialists, prompting many others to cut their ties.
Ghanaian authorities have spent $20m (£10.4m; 15.2m euros) on the commemorations, which are due to continue for the next 12 months.
The celebrations kicked off at midnight when, in the centre of Accra, there was a re-enactment of the day in 1957 when the British flag was lowered and the Ghanaian flag raised.
Revellers
The BBC's Will Ross in Accra says Ghanaians are clearly enthusiastic about marking this 50th year of independence.
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President Kufuor has inspected a massive guard of honour and hundreds and hundreds of school children all parading around the square, he says.
Many in the crowd - who are waving miniature Ghanaian flags - have been there all night.
"We've been here since 0100," Nii Armah, who is at the celebrations with his eight-year-old son, told AFP news agency.
"My wife is angry because we didn't sleep at home. She said it would be shown on TV but I wanted to see with my own eyes."
Some Ghanaians, including Abusi, have returned home from abroad especially for the anniversary.
"Everybody is happy, there is a big sense of unity, ecstasy, enthusiasm, national sense of pride," he told the BBC.
"People are really, really happy, full reconciliation across the party lines. Everybody is just welcoming the 50th anniversary."
Pride
On 5 March 1957, Britain formally transferred power to independence leader Kwame Nkrumah.
| | When you look at how our friends have suffered, by God's grace we are here, we have reason to be proud Nora Kattah |
The Duke of Kent is the British representative at events to remember the occasion, which triggered a chain reaction as other African nations moved towards independence.
African leaders, including South Africa's Thabo Mbeki, Robert Mugabe of Zimbabwe and Olusegun Obasanjo from Nigeria, are attending the ceremonies.
Singer Stevie Wonder is expected to perform a version of his track Happy Birthday dedicated to Ghana.
In the capital and beyond, the country's Black Star flag is fluttering from electricity poles, car windows and palm trees.
On the streets of the city, many are celebrating. "When you look at how our friends have suffered, by God's grace we are here, we have reason to be proud," Nora Kattah told Reuters.
Dissent
Our correspondent says many of the years following independence were like a rollercoaster, with coups and economic meltdown, but recent stability has offered hope.
The country is often cited as an example of stability, steady growth, and low inflation, with increases in its output of major exports including cocoa and gold.
But others have questioned the wisdom of holding lavish celebrations while many in the country remain without basic services.
President Jerry Rawlings, who ruled for almost two decades, has criticised the events and is boycotting them.
In a statement, he said he would not share a stage with "the same people who have taken every opportunity to denigrate us".
"Politically our leaders have failed us," Accra resident Emmanuel Danso said.
"Only politicians or people who know people live well in this country," he added.
The Architect of Independence
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