Cannabis will now be sold in stores and ordered online, with the drugs posted to customers' homes.
Prime Minister Justin Trudeau made legalising the drug a 2015 election promise in a bid to take the market away from organised crime.
"We're not legalising cannabis because we think it's good for our health. We're doing it because we know it's not good for our children," Mr Trudeau said.
"We know we need to do a better job to protect our children and to eliminate or massively reduce the profits that go to organised crime."
Canada is only the second nation after Uruguay to legalise the drug, although countries such as Portugal have decriminalised it - meaning those caught with the drug face civil punishment, such as a fine.
With 95 years of prohibition being lifted in Canada, provinces will be setting their own laws on marijuana sales.
Alberta and Quebec have set the minimum age for purchase at 18, while others have made it 19.
No stores will open in Ontario, which includes Toronto. The most populous province is working on its regulations and doesn’t expect stores until next spring.
“Prohibition has ended right now. We just made history,” said the 46-year-old Ian Power, who bought a gram in St John’s, Newfoundland to become one of the first people to buy the drug legally in the country.
“I can’t believe we did it. All the years of activism paid off. Cannabis is legal in Canada and everyone should come to Canada and enjoy our cannabis.”
In total, Statistics Canada says 5.4 million Canadians will buy cannabis from legal dispensaries in 2018 -- about 15% of the population. Around 4.9 million already smoke.
Canada has had legal medical marijuana since 2001.
As well as Mr Trudeau's attempt to cut out weed as a revenue stream for organised criminals, money from the drug will now end up more legal pockets.
According to accounting firm Deloitte, legal marijuana is expected to become more than a $6bn (£3.5bn) business in Canada in 2019, with up to $4.34bn (£2.5bn) coming from the legal recreational market and as much as $1.79bn (£1.04) from medical sales.
The reform will be scrutinised by Canadians ahead of the next election in 2019.
Mr Trudeau has previously admitted to smoking pot five or six times in his life, including at a dinner party with friends after being elected to parliament.
He has also said that his late brother Michel was facing marijuana possession charges for a "tiny amount" of pot before his death in an avalanche in 1998, and that this influenced his decision to propose legalising cannabis.
Mr Trudeau's office have said the prime minister "does not plan on purchasing or consuming cannabis once it is legalised."
In neighbouring US, nine states and the District of Columbia have legalised marijuana.
California, home to one in eight Americans, launched the US biggest legal marijuana marketplace at the start of the year.