James Bond and David Beckham starred as Britain welcomed the world to the Olympics in an eccentric opening ceremony showcasing the country's rich history and sense of fun.
Seven young athletes lit the cauldron in the climax to a show which ran into the early hours of Saturday before former Beatle Paul McCartney brought the curtain down at London's Olympic Stadium.Departing from the tradition of choosing a gold medal winner to light the cauldron, the London organisers handed the honour to the seven youngsters nominated by British Olympic heroes of the past.
Five-time gold medallist rower Steve Redgrave had brought the torch into the stadium in east London before passing it on to a series of young runners.
They embraced their mentors, including decathlete Daley Thompson and middle-distance runner Kelly Holmes, before the teenagers lit a series of torches which hydraulically lifted to create a high-tech cauldron.
Queen Elizabeth II, who had made a royal entrance like no other in a spoof film with James Bond actor Daniel Craig, declared the Games open as London took on the role of host nation for an unprecedented third time.
International Olympic Committee chief Jacques Rogge told the crowd of 80,000: "In a sense the Olympics are coming home," recognising Britain's role in developing modern sport.
The chief organiser of the Games, Sebastian Coe, thanked his fellow Britons for "making all this possible".
"In the next two weeks we will show all that has made London one of the greatest cities in the world," he said.
The show was quintessentially British, as its creator, British film director Danny Boyle, had promised.
The queen was shown parachuting from a helicopter with Craig into the stadium before the real 86-year-old monarch took her seat to loud applause.
The show traced Britain's development from a bucolic past through the Industrial Revolution before fast-forwarding to the present day.
It included a tribute to Britain's state-run National Health Service while actor Kenneth Branagh, "Harry Potter" author J.K. Rowling and "Mr Bean" Rowan Atkinson all had roles.
When the athletes paraded in, the world's fastest man Usain Bolt sauntered into the stadium carrying the Jamaican flag.
The Israeli team wore black handkerchiefs in their pockets to mark the 40th anniversary of the 1972 Munich Olympic massacre when 11 of their compatriots were killed after Palestinian extremists stormed the Athletes' Village.
Rogge had refused pleas to stage a minute's silence in their memory at the ceremony.
The British team was greeted with a huge roar from the crowd as they marched into the stadium last -- an honour reserved for the hosts -- behind four-time Olympic champion cyclist Chris Hoy.
The stage is now set for superstars Bolt, Michael Phelps and Roger Federer to dazzle in competition, while an army of unsung competitors are also aiming for gold.
A budget of £9.3 billion ($14.5 billion, 12 billion euros) has been spent on bringing the Games back to London.
In the pool, Phelps, whose eight golds in Beijing took his overall medal tally to 16, needs three more to surpass the all-time record of 18.
His has seven events in which to make more Games history and anchor a US team determined to continue its dominance against Australia and a Chinese squad spearheaded by 1500m free world record-holder Sun Yang.
One of his biggest challengers is teammate Ryan Lochte, who has emerged as a serious threat in the 200m medley and 400m medley.
Newly crowned Tour de France winner Bradley Wiggins -- who also appeared in the opening ceremony -- will fire up the home crowd in the cycling.
Federer, having won a record-equalling seventh Wimbledon title, returns to the All England Club looking to add singles gold to the doubles he won with Swiss compatriot Stanislas Wawrinka four years ago.
And the United States are hot favourites in the men's basketball with a Dream Team boasting NBA superstars LeBron James and Kobe Bryant.
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