Rao was accorded a traditional welcome at the 'yagashala' when he arrived there. He undertook a circumambulation of the 'yagashala' before performing 'Garu Prarthana' in front of the idol of 'Chandi Matha', a release from his office said.
The 'Garu Prarthana' marked the beginning of the 'yagam' rituals on the first day, it said.
Governor of Telangana and Andhra Pradesh E S L Narasimhan also took part in the puja.
'Gou puja', 'Maha Mantapa Sthapanam', 'Chandi yantra lekhanam', among others, formed part of the rituals on the first day, the release said.
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Massive arrangements have been made for the 'yagam' in the sprawling premises at Rao's farm house at Erravelli village in neighbouring Medak district.
President Pranab Mukherjee would visit the place on December 27.
Tamil Nadu Governor K Rosaiah, Maharashtra Governor C Vidyasagar Rao, Union Ministers M Venkaiah Naidu and Bandaru Dattatreya would attend the event on different days.
Andhra Pradesh Chief Minister N Chandrababu Naidu would attend the 'yagam' on December 27, the release said.
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Meanwhile, opposition BJP disapproved of the "exorbitant splurge of money and misusing government machinery for a personal event", though it supported performing "yagnas and yagas" for the larger public good.
"BJP supports yagnas and yagas for the larger good of the society. We have no issue with his personal events either. However, the exorbitant splurge of money and misusing government machinery for a personal event is unacceptable.
"BJP demands that the expenditure involved in laying roads to KCR farmhouse, security and logistics should also be borne by the Chief Minister," Telangana BJP spokesperson Krishna Sagar Rao said.
"Everybody has individual freedom. But, it should not be forgotten that the Chief Minister has a constitutional responsibility. Government should not encourage actions which promote caste and communal feelings. It is the responsibility of government heads to safeguard Constitutional secularism.
"...The yagam is against the spirit of 'secular' Constitution. He is not confining himself to personal worship. The President, who is the head of the Constitution, and other government leaders are being involved.
"It is false when Rao said he is bearing the expenditure himself. Officials of different departments are supervising the work. The expenditure of helicopters and cars...Are they being borne by him? People need to know these things," CPI(M) Telangana said in a statement.