In a surge of enthusiasm for the monarchy across Britain, thousands paraded through Perth in Scotland for the jubilee, many others held community parties and villages competed to create the longest stretch of bunting.
Crowds even turned out to watch military bands rehearse in London ahead of the main celebrations marking the queen's 60 years on the throne, support for the royals at its highest level in decades.
A recent poll showed about 80 percent of Britons want the country to remain a monarchy.
At the Epsom Downs racecourse just outside London, bookmaker Diane Barrett said: "It's a very special year. It's never going to be like this again."
Unexpected sunshine broke out, to more cheers from the 130,000 racegoers, as the queen, a keen rider and racehorse owner, watched the races from a balcony garlanded with flowers.
Paratroopers descended to the racecourse trailing huge Union Jack flags and red smoke ahead of the couple's arrival with sons Andrew and Edward, young princesses Beatrice and Eugenie, and other members of the royal family.
The queen wore royal blue and her trademark matching hat with flowers.
As Welsh soprano Katherine Jenkins sang the national anthem, Buckingham Palace posted on Twitter: "And we're off! The #diamondjubilee weekend begins."
Queen Elizabeth presented the 110-year-old Coronation Cup, renamed the Diamond Jubilee Coronation Cup for the occasion, to the team behind winning horse St Nicholas Abbey, which also won the race last year.
But the showpiece of the day was Britain's richest race, the Epsom Derby, won by favourite Camelot.
But the queen's own horse Set to Music could only manage second in a race at Haydock Park in northwest England.
Rachel Molloy, 28, a singer from London, said over strawberries and champagne, "We waved to her and it was very exciting because we've never seen the queen this close. She looked happy."
"I just want to see the queen," said Chinese student Adora Lin, 22, from the factory mega-city of Shenzhen, who had bought a new hat for the occasion.
"I'm not going to bet. I just want to see how people dress up and celebrate."
Andrew Cooper, director of racing at Epsom Downs, said: "The queen seemed relaxed throughout the day. She appeared pleased with Katherine Jenkins singing the National Anthem, you could see it in her face."
People were already camping in tents beside the river Thames ahead of a pageant of about 1,000 boats that will sail through London on Sunday, with the queen in a royal barge decked with 10,000 flowers.
Prince William and wife Catherine -- whose 2011 wedding drew two billion TV viewers and was credited with reviving public interest in the royals -- will join the queen in the procession.
"There is huge excitement. The queen has done a terrific job in the past 60 years," said Andrew Phasey, whose canal narrowboat will be part of the pageant.
"We feel hugely privileged to be taking part. It will be a terrific day."
Britons have planned more than 9,500 street parties for Sunday, although there are concerns about forecasts of heavy rain.
On Monday, some 4,000 beacons will be lit across the Commonwealth following a huge picnic and star-studded concert at Buckingham Palace.
Tuesday, which like Monday is a public holiday, will be devoted to ceremonial events including a thanksgiving service and carriage procession.
Shops across Britain were doing a brisk trade in Union Jack accessories, commemorative china, masks of the royals and jubilee garden gnomes.
In Northern Ireland, even republican party Sinn Fein has supported celebrations, backing the province's gift to the queen for the occasion.
Festivities are set to be more muted across the Commonwealth, mostly made up of former British colonies, but British soldiers were pictured in Afghanistan serving celebratory tea from a gold-coloured teapot.
The queen acceded to the throne on February 6, 1952, upon the death of her father King George VI while she was away in Kenya, and was crowned the following year on June 2, amid massive public enthusiasm despite heavy rain.
-----------------------------------------------------------------------------------------------