It is touted as a real-life setting in which to trial myriad inventions, from flying taxis to robot pets and drones that escort you home at night.
Around 360 Toyota staff and others related to the company will soon move in to smart homes in its "Woven City".
"This is a test course for the future, not just a town," Toyota's chairman Akio Toyoda told an opening event, according to national broadcaster NHK.
The number of residents in the cluster of homes built on a disused Toyota factory at the base of Mount Fuji is eventually expected to grow to 2,000, the firm says.
Toyoda has previously called it a "living laboratory where the residents are willing participants" and inventors can test ideas in a secure environment.
"Homes in the Woven City will eventually serve as test sites for future technology, such as in-home robotics, to assist with daily life," he said in January.
One example could be robots that learn how to fold shirts, Toyoda said.
The project, first announced in 2020, is led by his son, Daisuke Toyoda.
"Much like test drivers for cars... our residents will be the ones who use and experience the new products and services our inventors develop."
The company's e-Palette self-driving buses will also be tested at Woven City, among other autonomous logistics and driving technologies.
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