Indian priests Raghavendra Bhatta and Girish Bhatta, who were attacked by Maoists on Friday, performed puja at the Pashupatinath temple here amid tight security.
The Armed Police Force mobilised a special platoon for the newly appointed Indian priests.
Minister for Federal Affairs, Constituent Assembly, Parliamentary and Cultural Affairs Minendra Rijal visited the temple to assess the security situation when the priests began their job.
"It's a deplorable attempt to harm Nepal-India relations by trying to hinder the puja at the temple," Mr. Rijal told journalists.
"Bringing up a nationality issue is merely a way of politicising the appointment," Mr. Rijal said. "Religion is not associated with nationality."
Condemning the attack, Prime Minister Madhav Kumar Nepal said: "Those who assaulted the priests will not be forgiven."
Rishi Prasad Sharma, coordinator of a struggle committee protesting against the appointment of Indian priests, had said the government disregarded the people's aspiration to have a "Nepali priest in a Nepali temple."
In December, the Maoist-led government broke the age-old tradition by appointing Nepali priests at the Pashupatinath temple. The issue went to the Supreme Court, which asked the government to reinstate the Indian priests.
The row resulted in nitya puja being disrupted for the first time in Nepal's history.