A priest sprinkled holy water on the seven-metre tall statue of Kalashnikov gripping his deadly creation, which will now loom over motorists from a traffic island in one of the sprawling capital's central thoroughfares.
Culture minister Vladimir Medinsky praised the inventor and called the rifle -- which has been reproduced an estimated 100 million times worldwide -- a "cultural brand for Russia."
Kalashnikov had "the best traits of a Russian: an extraordinary natural gift, simplicity, integrity," Medinsky said.
Kalashnikov came up with the idea of inventing a new automatic rifle that could work in all conditions after becoming disgruntled by the Soviet weaponry as he recovered from an injury during WWII.
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Eventually that would lead to the creation of the AK-47 -- short in Russian for Avtomat Kalashnikova 1947 (Kalashnikov Automatic Rifle 1947) -- that would become the standard issue for the Soviet Union's vast armed forces.
Known for its simplicity, the gun became a symbol for independence struggles and leftist radicals around the world during the Cold War, finding its way onto the national flag of Mozambique and the banner of Lebanese Shiite movement Hezbollah.
While his invention made Kalashnikov a household name around the globe, the man himself had a more nuanced view of his lethal creation.
Six months before his death he wrote to the head of the Russian Orthodox Church, expressing regret for his role in making the world's most commonly used rifle.
"My spiritual pain is unbearable," he wrote in the letter which was later published in the Izvestia newspaper.
But the move chimes with a surge of nationalist pride under Putin that has seen the Kremlin glorify the military achievements of the Soviet period while playing down the gross abuses.
The Kalashnikov factory that makes the rifles, in decline since the death of the inventor, has since been modernised, with most of its capital coming from private investors.
It has also been transformed by a PR campaign to improve its image in Russia and abroad, even opening a souvenir store in Moscow's main Sheremetyevo Airport.