About three quarters of the candidates, all but two from the ruling communist party, are first-timers - a move officials say is designed to bring new blood to the party.
However, the elections have been criticised as a sham by Lao overseas groups that say the vote is designed to give the communist party's 30-year grip on power a veneer of democratic respectability.
The Paris-based Lao Movement for Human Rights said in a statment that by making voting compulsory, the ruling party "obliges voters to elect it by plebiscite since all the selected candidates must have the previous approval of the party".
The movement, which claims to represent more than 30 overseas Lao groups, said the elections were designed only to give the communist party "a democratic image in the eyes of the international community."
"There is a realisation that they're lagging behind and that is a very risky position for the governing party"
Land-locked Laos is officially classified by the UN as a Least Developed Country, with the majority of its 5.8 million population living on less than $2 a day.
One of five remaining communist states in the world, Laos has lagged far behind fast-growing Thailand as well as communist neighbours China and Vietnam in developing its economy.
Part of the blame, say critics, lies with the country's ageing leadership, many of whom are veterans of the bitter civil war in the 1960s and 70s against the former US-backed government.
Voters will be looking for change
from the new assembly
Officials say the new election will usher in new faces and, it is hoped, a new era.
"There is a realisation that they're lagging behind and that is a very risky position for the governing party," one Western diplomat who asked not to be named told Reuters.
While the winning party is not in doubt, in an effort to make the national assembly more diverse, party officials have given prominence to candidates from minority groups.
Women have been given a greater presence, with female candidates expected to take up about a third of the seats in the new parliament.