Israeli and Guatemalan officials - including the Guatemalan President Jimmy Morales - attended an inauguration ceremony at the new embassy at an office park in the contested city at the heart of the Israeli and Palestinian conflict.
The White House pushed forward with its inauguration Monday, while Israeli forces using live fire on crowds of Palestinian demonstrators protesting against the deeply controversial opening.
Israeli Prime Minister Binyamin Netanyahu praised the Central American nation for making the move, and said he would visit Guatemala on his next visit to Latin America.
At least 61 Palestinians were killed on Monday in the deadliest day in the besieged territory since 2014 war.
Over 2,400 Palestinians were wounded as Israeli snipers continued to fire into the crowds in an attempt to suppress the demonstrations.
Trump ignored widespread anger and condemnation and pushed ahead with embassy relocation plans. Global powers including the UK, France and Russia had previously slammed the US decision to move their embassy, while 128 nations backed a UN resolution rejecting the White House recognition of Jerusalem as Israel's capital.
Nine countries - including the US and Israel - voted against the resolution: Guatemala, Honduras, the Marshall Islands, Micronesia, Nauru, Palau and Togo.
Honduras is expected to follow Guatemala soon with opening an embassy in Jerusalem.
Czech foreign ministry said in a statement last month that the government would open an honorary consulate in Jerusalem in May.
Trump's move broke with decades of international consensus that Jerusalem's status must be negotiated between the parties, drawing near global condemnation.