The ceremony, which is believed to become the biggest canonisation service in history, came ahead of commemorations expected to see millions of people including heads of state on Friday mark 100 years since the start of the killings.
The service was being held in Armenia's main church, Echmiadzin, an austere fourth-century edifice said to be the Christian world's oldest cathedral, an AFP correspondent reported.
The ceremony outside the Armenian capital Yerevan was set to end at 7:15 pm local time to symbolise the year when the massacres started during World War I.
"Souls of the victims of the genocide will finally find eternal repose today," said 68-years-old social worker Varduhi Shanakian. "Supreme justice will triumph," he said ahead of the ceremony.
Also Read
In canonising the victims, "the Church only recognises what happened: that is, the genocide", Karekin II said ahead of the event which Christian Today, an online publication covering religious news, said could become "the biggest saint-making service in history".
Ex-Soviet Armenia and the huge Armenian diaspora worldwide have battled for decades to get the World War I massacres at the hands of the Ottoman forces between 1915 and 1917 recognised as a targeted genocide.
But modern Turkey -- the successor to the Ottoman Empire -- has refused to do so, and relations remain frozen to this day.
Ankara says 300,000 to 500,000 Armenians and at least as many Turks died in civil -- rather than religious -- strife when Armenians rose up against their Ottoman rulers and sided with invading Russian troops.