Some North Korean women beat their breasts in grief while male soldiers bowed their heads deeply to a motorcade including a hearse decorated with white chrysanthemums, a traditional mourning flower, according to a live broadcast by the North's state television.
A leading vehicle also carried a huge portrait of Kim with a broad smile on his face.
Kim, who ruled North Korea with an iron fist and pursued nuclear weapons programs in defiance of international pressure, was reported to have died suddenly of heart failure on Dec. 17 at the age of 69.
Kim's youngest son, North Korea's new leader Kim Jong-un, walked at the right front of the hearse, followed by the North's military and political leaders, including his uncle and patron Jang Song-thaek, as the funeral motorcade departed from the plaza of Kumsusan Memorial Palace towards downtown Pyongyang for a 40-odd kilometer trip, according to state media.
North Korean soldiers and ordinary citizens lined the streets in Pyongyang in freezing temperatures to pay their last respects to Kim.
Some North Koreans fainted, overwhelmed by bitter sorrow, the North's official Korean Central News Agency quoted military officer Kim Kyong-jun as saying from a mourning venue.
"I fainted while mourning here. I am missing leader Kim Jong-il so much," An Ri-ho, an 86-year-old woman, told the KCNA as she choked back tears.
Kim's body will return to lie in state in Kumsusan Memorial Palace, where the embalmed body of his father and North Korea founder Kim Il-sung also lies.
The North's state media heaped praises on its deceased "Dear Leader" for his efforts to build a nuclear state and his revolutionary legacy, which it claims promises a bright future for the North.
North Korea, one of the poorest countries in the world, has vowed to build a prosperous nation by next year, the centennial of the birth of Kim's father, the country's late founder Kim Il-sung.
"North Korea has been dignified as a country that manufactured and launched artificial satellites and accessed nukes," the North's main Rodong Sinmun said in a political essay carried by the KCNA.
North Korea conducted two nuclear tests in 2006 and 2009, drawing international condemnation and tightened U.N. sanctions.
The state funeral, its first since 1994, was delayed for at least four hours due to heavy snow that began Tuesday night.