The procedure began at 7:15 am (0145 GMT) and doctors were upbeat about the prime minister's prognosis.
"We expect the prime minister to be up on his feet in the next couple of days in the intensive care unit," Dr. Sudhir Vaishnav of Mumbai's Asian Heart Institute said, adding Singh should be back at work within "two to four weeks."
"I don't think the nation should worry (about the premier's health)," he told India's NDTV network.
The operation was being carried out at the premier state-run All India Institute of Medical Sciences in New Delhi.
A high security ring was thrown around the hospital with gun-toting security personnel keeping a strict watch.
A team of 11 doctors from the Asian Heart Institute flew from Mumbai for the operation, said Vaishnav.
A hospital source earlier told AFP doctors were "looking at the removal of two blockages. The rest of the regime will be decided when the surgery is on."
Singh, a diabetic who walks regularly, underwent heart bypass surgery in Britain in 1990 and angioplasty in 2003.
He has largely been in good health since he was sworn in as prime minister in May 2004 but recently underwent prostate surgery and has also had cataract treatment.
India is due to hold general elections before May, and the ruling Congress Party has said the quietly spoken economist and politician will head the party into the polls.
Congress had earlier this week dismissed concerns that Singh's health would interfere with its election campaign, and said the prime minister was "absolutely fine."
Government officials said foreign minister Pranab Mukherjee would take charge of cabinet meetings during the premier's absence and would also assume control of the finance portfolio, currently held by Singh.
But no official acting prime minister had been named.
"Our confidence is that within two weeks he will be back to duty with more energy," said senior Congress party leader M. Veerappa Moily.
He called it "irrelevant to talk about it (a change in leadership). Manmohan Singh is our prime minister and our vibrant prime minister," he said.
Mukherjee called his additional duties on Friday "normal, routine things" adding "the government is in place."
There has been widespread speculation that party chief Sonia Gandhi has been lining up her son, Rahul Gandhi, heir to India's powerful Gandhi dynasty, as the country's next prime minister.
An editorial in Saturday's Times of India newspaper said Singh's leadership would be missed during this time of economic turbulence and tense relations with neighbouring Pakistan, but that it was time to look for younger leaders.
The paper said the prime minister's age and health would be a concern to an electorate which is looking for younger leaders, with 51 percent of India's population of 1.1 billion under 25 and two-thirds under 35.
Singh's operation was front-page news in all the national dailies and dominated television newscasts.
Prayer sessions were held across the country for Singh's swift recovery and political leaders from all sides expressed hopes for a speedy return to good health.
"We have been worried about his health ever since we heard the news. I am sure he will be all right soon," said opposition Hindu nationalist leader Lal Krishna Advani.
Family members offered prayers at the Golden Temple in Amritsar, the holiest site in the Sikh religion, to which the prime minister belongs.
Singh's nephew, Kuldip Singh, told NDTV news the close-knit family was praying for the prime minister's health.