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He performed a symbolic coronation of Lord Ram at the temple town.
PM Modi will see an "aarti" on the banks of the River Saryu, followed by launch of the Deepotsav celebrations, the statement said.
Five animated tableaux and 11 Ramlila tableaux showcasing dance forms from different states will be presented.
PM Modi will see a 3D holographic projection map show at Ram Ki Paidi on the banks of the Saryu, along with a musical laser show.
Uttar Pradesh Chief Minister Yogi Adityanath welcomed PM Modi after he landed in Ayodhya.
Ayodhya Divisional Commissioner Navdeep Rinwa said over 15 lakh lamps will be lit by more than 22,000 volunteers at Ram Ki Paidi by the banks of the Saryu. Some of the lamps will be placed at important intersections in the town.
Volunteers have been told to arrange 256 lamps in a square and the distance between two squares will be approximately two to three feet, Deepotsav organisers told news agency PTI.
On the security arrangement, Ayodhya's top police officer Prashant Verma said, "In all, 4,000 cops will be on security and safety duty. Crowd management is a major priority, so that devotees, tourists and artists do not face any problem."
Ayodhya Mayor Rishikesh Upadhyay said the town is ready to welcome people arriving from different parts of the country and the world to see the Deepotsav celebrations.
"This Deepotsav is going to be more grand and memorable for us as Prime Minister Narendra Modi will be coming for the event," said RP Pandey, a resident.
With inputs from PTI
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