With a top speed of 350 kilometres (220 miles) per hour, the bullet train "Whoosh" can get between the capital Jakarta and Bandung in 45 minutes.
The 140 km journey would previously have taken about three hours by train.
"The Jakarta-Bandung high-speed train marks our efficient, friendly, and integrated mass transportation system," Widodo said during a ceremony at the capital's central station.
"It is a symbol of our modernisation in the public transport, seamlessly connecting with other modes of transportation."
Widodo said the 600-capacity train was the first high-speed rail transportation in Southeast Asia.
It is part of Beijing's Belt and Road initiative -- a decade-old programme of China-backed infrastructure projects.
The president said the name was actually an acronym, standing for a tagline of "Waktu Hemat, Operasi Optimal, Sistem Handal" -- which in Bahasa Indonesia means "Saving time, optimal operation, reliable system".
It was built by PT KCIC, which is made up of four Indonesian state companies and Beijing's China Railway International Co.
The project was initially set to cost less than $5 billion and be completed by 2019.
However, delays caused by construction challenges and the Covid-19 pandemic led to a surge in costs.
In preparation for its opening, officials have conducted public trials for the new high-speed route.
Last week, Transportation Minister Budi Karya Sumadi confirmed that the government would extend the high-speed train route from Bandung to the country's second-biggest city Surabaya.
Last month, Chinese Premier Li Qiang joined Senior Minister Luhut Pandjaitan on a ride aboard the train during his Jakarta visit for summits with Southeast Asian leaders.
Pandjaitan told reporters on Thursday that Widodo plans to welcome Chinese President Xi Jinping in the future to ride the train, but did not give more specifics.
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