Turkish President Recep Tayyip Erdogan and his Russian counterpart Vladimir Putin attended the ceremony in Istanbul along with Serbian President Aleksandar Vucic and Bulgarian Prime Minister Boyko Borissov, Xinhua news agency reported.
The TurkStream will provide gas to Turkey and the south and southeast Europe in two parallel pipelines, running 930 km through the Black Sea, from the Russian city of Anapa to the northwestern Turkish town of Kiyikoy in the Trace region.
One pipeline will supply gas to Turkey, and the other will reach the Turkish-European border to carry the gas first to Bulgaria, Serbia and Hungary.
Speaking at the ceremony, Putin said Turkey and Russia will implement many more mutually beneficial projects in energy and other areas, despite efforts at obstruction.
For his part, Erdogan called the pipeline project "historic" in terms of the bilateral ties and the world's energy map.
Russia's Energy Minister Alexander Valentinovich Novak described the project as one of the world's largest infrastructure projects, boosting Turkey's role on the world stage.
TurkStream will deliver a total of 31.5 billion cubic meters of Russian natural gas each year, with Turkey receiving half of it and Europe, the rest.
Turkish Minister of Energy and Natural Resources Fatih Donmez said the project would eliminate possible transit risks by making Turkey the first buyer of the natural gas.
( With inputs from IANS )