Beginning in December, the three-tonne probe will conduct a year-long observational mission of the lunar surface after gradually moving into a lower orbit.
"We believe this is a big step," Yoshisada Takizawa, the project manager, said. "Everything is going well and we are confident."
The mission involves placing a main satellite - called "Kaguya" after a legendary moon princess - in a circular orbit about 100 km above the lunar surface, after which two smaller satellites will be deployed in elliptical orbits, the agency said.
"Everything is going well and we are confident"Yoshisada Takizawa, Jaxa project manager
"The timing was very delicate," said Takizawa in Tokyo via a video link from the mission command centre south of Tokyo. "It was important to the completion of the mission, and it was successful."
SELENE will collect data for Japanese researchers in a study of the moon's origin and evolution.
Japan claims the 32bn yen ($279m) mission, launched four years off schedule on September 14, is the most ambitious lunar mission since America's Apollo moon landings in terms of overall scope and objectives.
SELENE'S entry into lunar orbit marks a major breakthrough for Japan which launched its first satellite in 1970 but is now struggling to keep up with China in an accelerating Asian space race.
|Kaguya will orbit the moon collecting data for a|
year [Japan Aerospace Exploration Agency]
China is expected to launch its own moon probe by the end of the year, and India has said it will launch its own unmanned lunar mission in 2008, followed up by a manned space mission by 2015, using indigenous systems and technology.
For its part Japan has been expanding its space operations and aims to send an astronaut to the Moon by 2025.
Japan launched a lunar probe in 1990, but that was a flyby mission. Another shot scheduled for 2004 was cancelled following a string of mechanical and fiscal problems.
To garner public interest, the probe carries sheets engraved with messages from 412,627 people around the world in what space officials called the "Wish upon the Moon" campaign.
China however continues to lead Japan in Asia's space race after it became the first Asian country to put its own astronaut into space in 2003.
More ominously, China also blasted an old satellite into oblivion with a land-based anti-satellite missile, the first such test ever conducted by any nation, including the US and Russia.
The test of the space weapon sparked warnings that China risked triggering an arms race in space.