Hamas and other militant Islamic groups boycotted the ceremony, which was led by a Fatah official, and the Hamas representative in Lebanon played down the office's significance.
"The Palestinian representative office to be opened in Beirut represents only the PLO, which does not represent all the Palestinian people," Osama Hamdan said in a statement Sunday.
Palestinian President Mahmoud Abbas, a political moderate and the Fatah leader, has been involved in an increasingly bitter power struggle with the new Hamas-led Palestinian government for control of the Palestinian security forces since the militant group won January legislative elections.
Abbas has repeatedly called on Hamas and other radical groups to renounce violence against Israel in an attempt to revive stalled peace talks with the Jewish state. Hamas has refused.
Abbas Zaki, the Fatah official, flanked by Lebanese Foreign Minister Fawzi Salloukh and Fatah officials, cut a ribbon and raised the Palestinian flag at the PLO building in a southern Beirut suburb.
"Today Palestine returns to Lebanon and Lebanon returns to Palestine," Zaki said. "I tell my Palestinian brothers that this office represents all Palestinians, be they in the political process or in the opposition."
Fatah, founded by former Palestinian leader Yasser Arafat, is the dominant faction of the PLO.
Zaki proposed the formation of a joint delegation representing Fatah and all Palestinian factions to hold talks with Lebanese officials on the conditions of the 350,000 Palestinian refugees in Lebanon.