The tiny republic of San Marino, nestled within Italy, ushered in the world's first openly gay head of state on Friday, with equality activists hailing it as a "historic event." 

Paolo Rondelli, 58, is one of two Captains Regent elected by the legislature who will lead San Marino, a microstate of 34,000 people, for the next six months, as per tradition in the northern republic.

The relatively conservative Catholic nation only decriminalised homosexuality in 2004.

But in recent years San Marino has taken steps to strengthen civil rights, most recently voting in a September referendum to legalise abortion. 

A former chemical engineer, Rondelli began working in politics in the 1990s and served for nine years as San Marino's ambassador to the United States beginning in 2007.

"I will probably be the first head of state in the world to belong to the LGBT+ community (only ministers and prime ministers so far)," wrote Rondelli on his Facebook account Saturday.

Marco Tonti, head of the Arcigay association in Emilia-Romagna, the Italian region in which San Marino is landlocked, hailed it as "a historic event." 

"This is the first head of state who is openly homosexual and an activist for the rights of the LGBT community," Tonti said. 

"There are precedents among heads of government and ministers, but this is a world first for a head of state." 

That group includes Luxembourg's Prime Minister Xavier Bettel, and Iceland's former prime minister, Johanna Sigurdardottir, who became the world's first openly gay premier in 2009.

Among those at the inauguration Friday were Italy's justice minister Marta Cartabia and Italian Senator Monica Cirinna, who has been active championing LGBT+ rights. 

Rondelli, Cirinna wrote on Facebook, is "a man of immense culture and diplomatic and political experience" who has "fought for the rights of women and LGBT people".