Over 2,000 sportsmen and women from around the world paraded into the arena in Visby to open the biennial event.
The ceremony featured jousting and dance as well as the traditional water ceremony - the Games' equivalent of the Olympic flame - where each island brings water from home to mix together.
Six days of sport begin on Sunday.
Of the 14 different sports featuring in the games, triathlon, badminton and tennis will be among the first to start on Sunday.
"We want development, we want success and we want friendship," said International Island Games Association chairman Jorgen Pettersson, who addressed the crowd.
"This is the 17th time we gather and celebrate a week that will be filled with magic.
"Our Games has made a difference, together we have strengthened sporting life within the islands, but even more importantly the Island Games has made people and societies grow together."
The 2017 Island Games got under way in the Swedish island of Gotland with a colourful medieval-themed opening ceremony on Saturday.