The Argentine pontiff started addressing the crowd inside a large stadium in the southern Swedish town of Malmö at 10am.
Around 20,000 members of the country's Roman Catholic minority are in attendance, many of them converts or migrants.
A fervent advocate of Christian unity, Francis visited the southern city of Lund, followed by Malmö, on Monday for an ecumenical service marking the start of a year of celebrations for the Reformation – the dramatic 1517 event that created a Protestant branch of Christianity which rebelled against papal rule.
The event in Lund, where the Lutheran World Federation was founded in 1947, also marked 50 years of reconciliatory dialogue between the Catholic Church and Lutheranism; a tradition once fervently hostile to the authority and teachings of the Vatican.
Together with Sweden's female archbishop Antje Jackelén and other Lutheran leaders, the Pope expressed deep regret over the conflict between Catholics and Protestants during Christianity's schism five centuries ago, calling for unity.
AS-IT-HAPPENED: Pope Francis' visit to Lund and Malmö
Hailed as “a breath of fresh air” by Swedish Lutheran leaders, Francis raised hopes early in his papacy that he might steer the church towards greater acceptance of homosexuality, and in June he said Christians “must apologize” to gays and lesbians for their past treatment.
Anders Arborelius, Bishop of the Roman Catholic Church in Stockholm, however said the Pope's approach has been one of continuity, despite a “progressive” image compared to his predecessors.
“Pope Francis comes from another continent and has a different way of expressing things, but one cannot say that he has changed anything in the teachings,” he told the AFP news agency.
Sweden's branch of the Lutheran Church is among the most liberal in Christendom, and the Pope's visit highlights deep splits between the Vatican's doctrine and Swedes' way of life.
A pioneer in women's and LGBT rights, the Nordic nation's Lutheran Church has been appointing female priests since 1960, a step the Catholic Church is still reluctant to take.
Figures released in 2010 showed that 45 percent of Sweden's nearly 4,500 professional priests were female, with the proportion even higher among parish priests.
— Emma Löfgren (@ekjlofgren) October 31, 2016
The Swedish Lutheran Church says it currently has 6.2 million members, more than 60 percent of the nation's population. But as fewer Swedes believe or practise religion, the Church has also lost more than 550,000 of its members in ten years.
Agneta Sofiadotter, a 62-year-old artist in Lund, was born to a Lutheran family but converted to Catholicism because she felt the Swedish Church had given up on the community and holy rituals, tainted by atheism.
“I was terrified over the members of the Swedish Church not even praying together for their work,” Sofiadotter told AFP. “In the Catholic assembly there is a constant community prayer… one prays together with the church leader.”
“It is clear that you get an incredible longing for a communion with God,” she added.
On the other hand, Catholicism is on the rise in Sweden. The Church now has 113,000 members (1.1 percent of the population) compared with only 87,000 in 2000, but it says it believes the actual number of Catholics in the country to be 150,000.
Even Bishop Anders Arborelius was born into the Lutheran Church but later converted to Catholicism.
Referred to as “The Church of the converts”, the Swedish Catholic Church in recent years has seen a three-four percent annual increase in members, mainly triggered by immigration, church registrar Louis Michel told AFP.
Historically, immigrants have mainly come from war-torn countries such as present-day Syria and Iraq, Lebanon in the 80s, and Latin America in the 60s and 70s, according to Michel.
By AFP's Catherine Marciano.