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Modi, 68, was administered the oath of office and secrecy by President Ram Nath Kovind at a glittering ceremony at the forecourt of majestic Rashtrapati Bhavan.
The other top leaders who were sworn-in as Union ministers included BJP president Amit Shah, Rajnath Singh, Nitin Gadkari, D V Sadananda Gowda, Nirmala Sitharaman and Ram Vilas Paswan.
While Modi, Singh, Shah, Gadkari, Paswan took oath of office in Hindi, Gowda and Sitharaman took it in English.
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Top opposition leaders including former prime minister Manmohan Singh, Congress President Rahul Gandhi and UPA Chairperson Sonia Gandhi, corporate honchos, film stars, chief ministers and a galaxy of leaders from BIMSTEC countries were part of the nearly 8,000 guests at the ceremony.
This is the second time Modi took the oath at the forecourt of Rashtrapati Bhavan. Modi was sworn in by the then President Pranab Mukherjee in 2014 in the presence of over 3,500 guests including the heads of SAARC countries.
Earlier, Chandra Shekhar in 1990 and Atal Bihari Vajpayee in 1999 were sworn in at the sprawling forecourt.
Leaders of BIMSTEC countries including President of Bangladesh Abdul Hamid, Sri Lankan President Maithripala Sirisena, Nepal Prime Minister K P Sharma Oli, President of Myanmar U Win Myint and Bhutanese Prime Minister Lotay Tshering also attended the gala event.
From Thailand, its Special Envoy Grisada Boonrach represented the country.
Besides India, BIMSTEC (Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation) comprises Bangladesh, Myanmar, Sri Lanka, Thailand, Nepal and Bhutan as members.
Kyrgyz President and current chair of Shanghai Cooperation Organisation Kyrgyz President Sooronbay Jeenbekov, and Mauritius PM Pravind Kumar Jugnauth also attended the event.