Resentment on the southern island has simmered for years among residents opposed to the U.S. Marines' Futenma air base there. They want the base moved off the island but the central government aims to relocate it to a less-populated part of Okinawa.
Prime Minister Shinzo Abe and the U.S. ambassador to Japan, Caroline Kennedy, attended the ceremony in Tokyo, with another event on Okinawa planned for Thursday.
The U.S. military said in a statement Japan had made sufficient progress in building helipads and access roads to consolidate military training in other areas and allow for the return of the 9,909 acres.
The returned land is part of the Northern Training Area, or Camp Gonsalves or the Jungle Warfare Training Center, and is the largest U.S. installation in Japan with 19,300 acres of land.