Various African heads of state are expected at the ceremony.
Mr Barrow is only the third president in the history of The Gambia.
He was sworn in last month in a low-key event in neighbouring Senegal before his predecessor agreed to step down.
Saturday’s much larger scale ceremony is taking place in a stadium near the Gambian capital, Banjul.
The celebrations also mark 52 years of the west African country’s independence.
Crowds queued through the night to get a good spot inside the stadium and witness national history.
Brass bands prepared to play and flags waved.
Long-time leader Yahya Jammeh was voted out in December but he only agreed to step aside when regional powers sent in troops ready to remove him by force.
He has since fled to Equatorial Guinea.
Mr Barrow has promised a new dawn for the country, which Mr Jammeh ruled with an iron fist.
Many political prisoners have already been freed and The Gambia is set to rejoin international institutions such as the International Criminal Court and the Commonwealth.
Posted by Janice Johnson (Source: BBC)