A wreath was laid at the monument erected at the market after the 1992-95 war, by Bosnian Presidency Chairman Zeljko Komsic, Sarajevo Mayor Ivo Komsic, delegations of municipal and cantonal authorities, and the victims' families.
The massacre prompted Western air raids against Bosnian Serb army positions, marking a watershed in the war and paving the way for peace talks in Dayton and the end of the three-and-a-half year war.
The Hague war crimes tribunal sentenced Bosnian Serb army generals Stanislav Galic and Dragomir Milosevic for the atrocity. Galic was given a life sentence and Milosevic is serving 29 years in prison.
This case is part of an indictment against Bosnian Serb wartime military commander Ratko Mladic, who is standing trial in The Hague.
Testifying about the mortar attack, police investigator Emir Turkusic said on Tuesday that the mortar which caused the tragedy was manufactured in Serbia in 1993 and that it was fired from positions held by the Bosnian Serb army.
A similar atrocity occurred at Markale on 5 February 1994, when a shell fired by Bosnian Serbs killed 68 and wounded more than 140 people.