The Tibetan Buddhist leader is expected to hold several public lectures and meetings with Buddhist clergy in Ulan Bator.
Organisers of the visit have kept the Dalai Lama's travel schedule under tight wraps in an attempt to avoid angering Beijing, which cut off rail links with Mongolia for two days in 2002 in apparent retaliation for his last visit.
The Mongolian government has not been openly involved in arranging the visit, and it wasn't clear whether the Dalai Lama would be received by Nambaryn Enkhbayar, the Mongolian president, or other top leaders.
Bazargur, a high-ranking monk at Mongolia's largest monastery and the Dalai Lama's host, said: "The top-ranking lamas had a meeting and decided to keep the visit low profile so as not to annoy China."
A few dozen signs welcoming the Dalai Lama along the main road from the airport were the only displays publicising the visit. Media have been given little information about his plans, and the Dalai Lama and his delegation were expected to stay at a secluded government guest house outside the city.
Despite the understated welcome, Bazargur said Buddhists had high expectations for the Dalai Lama's visit.
"Every time he comes, he boosts Mongolian Buddhism to a higher level."
Referring to factional struggles within the Mongolian Buddhist community, he said: "We hope he will continue to bless us and help us overcome some of our problems."
China routinely calls on countries not to let the Dalai Lama visit, often hinting at possible diplomatic or commercial retaliation. Beijing has yet to issue a formal statement on this visit, but recent statements in Communist party media have criticised such trips as an effort to rally anti-China forces and realise Tibetan independence.
Angry verbal protests
The Dalai Lama was expected to hold a series of lectures for the public and Buddhist clergy.
Monks arriving from around the country waited for further information, while outside, tourists and Mongolians fed pigeons and examined a recently added photo display of the Dalai Lama's 2002 trip.
China responded to that earlier trip with angry verbal protests and suspended rail services with Mongolia for two days, cutting off trade and driving up the world price of copper, Mongolia's main export.