Galileo, which launched on Thursday, has 18 satellites in place so far and will initially be boosted by satellites from the American GPS system.
But its signal will grow stronger and more independent as satellites are added to the network 14,430 miles above the Earth.
The EU Commission and European Space Agency, which created the system, said Galileo should be fully operational by 2020, and will provide positioning data of unprecedented accuracy.
Elzbieta Bienkowska, EU industry commissioner, said in a statement: "Today, Galileo, the most accurate satellite navigation system in the world, becomes a reality."
Named after Italian astronomer Galileo Galilei, the project was first approved with an initial budget of around €3bn (£2.5bn) and was supposed to be operational by 2008.
But it was hit by several technical and budgetary setbacks, including the launch of two satellites into the wrong orbit in 2014.
Its total cost is now calculated at around €10bn (£8.35bn).
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