Cardinal Jose Saraiva Martins, prefect of the Vatican's Congregation for the Causes of Saints, presided over the ceremony in the northwestern city of Linz for Franz Jaegerstaetter, who was declared a martyr in June by Pope Benedict XVI.
Jaegerstaetter was executed outside Berlin on Aug. 9, 1943, after the young farmer - a devout believer and a conscientious objector - was arrested for desertion.
He had been the only person in his village to vote against the creation of a "Greater Germany" shortly after Austria was annexed in 1938.
Jaegerstaetter's beatification gave Austrians a fresh opportunity to examine "our own wartime past: the war generation, inhumanity, and the terror of the Nazis," Austrian bishops Ludwig Schwarz and Manfred Scheuer said in a statement.
"He is a shining example in his fidelity to the claims of his conscience - an advocate of nonviolence and peace," they said, praising Jaegerstaetter for standing up to "the inhuman and godless system of Nazism."
In 1997, a Berlin court posthumously exonerated Jaegerstaetter, who was ordered to be put to death for treason after his request to be excused from regular army service for religious reasons was denied.
About 4,000 faithful and 30 crimson-robed bishops from Austria and abroad joined Jaegerstaetter's widow, Franziska, at Friday's ceremony, which was broadcast live on national television from Linz, about 200 kilometers (120 miles) west of Vienna.
"I always prayed to the Lord God that he would let me live to experience this day," said his widow, now 94.
The beatification was held on Austria's National Day holiday, which marks the anniversary of a 1955 law declaring the country to be neutral.
In its official biography of Jaegerstaetter, the Diocese of Linz says he had a dream in 1938 warning of the horrors of Hitler's regime to come.
"In it, he saw a train carrying innumerable people to perdition, and its meaning was unveiled to him as representing the Nazis," it says.
After World War II, two Franciscan nuns brought an urn containing Jaegerstaetter's ashes back to the province of Upper Austria, where he had long been celebrated as a martyr, meaning he died for the church.
Last year, President Heinz Fischer named a park in honor of Jaegerstaetter in Hitler's birthplace of Branau am Inn - a town not far from where Jaegerstaetter himself was born in 1907.
Before he can be canonized, or named a saint, a miracle attributed to Jaegerstaetter still must be confirmed. The process is complicated and usually takes decades, sometimes centuries.