Supporters of Chaudhry threw rose petals on his car as it entered the court compound. Chaudhry had technically resumed work on Sunday, the day after the justice who had replaced him retired.
Western officials, who seek to eradicate al-Qaeda and Taliban fighters active along Pakistan's border with Afghanistan, have welcomed Chaudhry's return.
Chaudhry was dismissed by Pervez Musharraf, the former president, on November 3, 2007 along with 60 other judges, when Musharraf declared emergency rule in a move to extend his presidency for another term.
Asif Ali Zardari, the Pakistani president, in a message on Monday, urged feuding factions to put aside their differences.
"I urge everyone to work in the spirit of tolerance, mutual accommodation, and respect for dissent and invite everyone to participate in the national effort for national reconciliation and healing the wounds, Zardari said.
Zardari's message was one of several in recent days from the ruling party urging peace with the opposition, which had demanded that Chaudhry be reinstated.
The prime minister even visited the home of opposition leader Nawaz Sharif in a goodwill gesture.
Zardari's initial reluctance to reinstate Chaudhry had set him on a collision course with Sharif and the lawyers.
The government caved into pressure and agreed to restore the chief justice after opposition workers and the lawyers headed to stage a massive rally in Islamabad.