The rainbow flag symbolising LGBTIQ pride is flying over Sydney Town Hall signalling the beginning of the city's 2021 Mardi Gras season.
This year's Mardi Gras theme is "rise" celebrating resilience and strength in a year of challenge and hardship.
The Mardi Gras 2020 parade was the city's last major event before coronavirus lockdowns began.
"One weekend we were laughing, dancing and kissing on Oxford Street, and in an instant, life was drained from our city," Lord Mayor Clover Moore said.
Celebrations will culminate in the 43rd Sydney Gay and Lesbian Mardi Gras Parade on March 6, albeit in a COVID-safe way, this time at the Sydney Cricket Ground.
British pop star Rita Ora will headline the event to be broadcast live by SBS.
A maximum of 23,000 spectators will be allowed into the SCG, as the parade moves away from the traditional large floats and instead focuses on the sparkling costumes, puppetry and props.
Mardi Gras chief executive Albert Kruger has said it was important, despite caution around large gatherings, to give the community a creative platform after the devastating impacts of the pandemic.
Clover Moore said the event would be crucial to the economic recovery process in Sydney and will have the emotional effect of breathing life back into the city.
Oxford Street in Darlinghurst, the traditional location of the parade, will still be a focal point throughout the Mardi Gras season, with a two-week program of music, art and live performances, in an effort to support local bars, restaurants and shops in the area.
Events include queer dating tips, trans storytelling, drag shows and kinky cabaret.
Sydney Mardi Gras season runs until March 7.