The vote will also help rebuild investor confidence to mend an economy crippled since President Andry Rajoelina seized power in a 2009 coup.
It was the first vote on the huge nickel- and vanilla-producing island off Africa since the upheaval triggered by protests and mutinous soldiers that drew sanctions against Madagascar and prompted donors to freeze crucial budget support.
Election officials at one primary school in the capital, Antananarivo, showed the first voters and political party representatives the empty plastic ballot boxes before sealing the containers. The first ballots were cast shortly after 6 a.m.(0300 GMT).
"We need to end this crisis. As far as I am concerned, this election is our last chance," said laboratory worker Faly Richard Randrianarivo. "The vote should allow our next leaders to tackle the high unemployment and our schools."
Rajoelina, a former disc jockey, and the wife of the man he ousted, Marc Ravalomanana, were barred by an electoral court from competing. With no clear favourite among the 33 candidates, the election is not expected to produce an outright winner, meaning a likely runoff in December.
Initial results are likely to come in slowly on the island, which is a bit smaller than Texas. The electoral commission has until Nov. 8 to announce a provisional count.
Presidential hopefuls have crisscrossed the Indian Ocean isle famed for its exotic wildlife and threatened rainforests, promising free primary education, better management of mineral resources and a crackdown on corruption.
Many Malagasy are less optimistic, however, and fear the result will be disputed. That would risk prolonging uncertainty and more turmoil on the world's fourth largest island, situated in the Indian Ocean, as it struggles to lure back foreign investors, tourists and donors.
Madagascar's cash-strapped economy needs budgetary support back from foreign donors, its finance minister told Reuters.
Rajoelina, 39, rose to power after galvanising popular anger at Ravalomanana's perceived abuses of power. He spearheaded violent street protests in early 2009 and toppled the self-made millionaire after dissident soldiers swung behind him.
Diplomats said they were keeping a watchful eye on the military, still headed by a general who backed Ravalomanana's ouster and whose commanders are seen as loyal to Rajoelina.
"The Malagasy want a president ... who is not hungry for power. The people deserve a better future," Rajoelina said late on Thursday in a pre-recorded address to the country.
The bitter rivalry between Rajoelina and Ravalomanana persists. Both men agreed with regional states not to run for the presidency in order to help restore order, but remain influential in the voting, analysts say.
Ravalomanana, who fled to South Africa and remains there, has openly backed Jean Louis Robinson, a former minister during his presidency and regarded as a serious contender.
Publicly, Rajoelina has not endorsed a candidate. But two aspirants, Hery Rajaonarimampianina, a former finance minister, and Edgard Razafindravahy, are both widely seen as close political associates of the outgoing president.
One Western diplomat said flaws in the voting process were inevitable but that the alternative was another delay. Rajoelina first promised an election in late 2010.
"Everybody knows the vote cannot be perfect but everybody is playing the game," said Lydie Boka of French risk group StrategiCo. "Given the circumstances, maybe that is the best they can do."