Although visits by Algerian-born French citizens known as Pieds Noirs have been increasing over the past couple of years, this was the first such group visit.
The mayor of Tlemcen, west of the capital, Algiers, met the visitors at the airport on their arrival on Sunday and accompanied them to the city, which used to be an important center of Jewish life before the Algerian war of independence against France, which ended in 1962 and which resulted in a mass exodus of French citizens.
Excitement mounted as the visitors approached their hotel in the town centre.
"There's my school," said one. "Look, that's where I lived," said another.
"I am very moved by this warm welcome," said Georgette Bettan, struggling to make herself heard over the sound of a traditional orchestra.
An impromptu meeting took place between Algerian former president Ahmed Ben Bella, who was visiting the town, and Andre Charbit, the head of an organisation representing 1300 Jews from Tlemcen.
"I welcome you from the bottom of my heart"
Ahmed Ben Bella,
"I welcome you from the bottom of my heart," Ben Bella said, recalling a shared passion for soccer.
Set amid olive groves and vineyards, Tlemcen is one of Algeria's most important Islamic cities with many vestiges of Ottoman architecture.
The trip was being undertaken with the encouragement of Algerian President Abdelaziz Bouteflika, who recently spoke in favour of return visits by the French colonists who were expelled in 1962.
The visitors were to see their former neighbourhoods and make a pilgrimage on Thursday to the tomb of a 14th century Jewish sage Rabbi Enkaoua.
The exiles' return was welcomed
by Algerian President Bouteflika
The tomb was recently renovated at the initiative of Bouteflika, whose family is also from Tlemcen.
Some 300,000 Jews fled Algeria at independence, and only a handful of elderly Jews live in the country today.
In January a joint delegation of French Muslims and Jews visited the city of Oran, and reached an agreement with municipal authorities for the renovation of the Jewish cemetery there.