Queen Elizabeth addressed thousands of people who gathered on Parliament Hill Thursday, telling Canadians they should be proud of what their country has accomplished in 143 years.

"I've been a witness to this country for more than half its life since Confederation. I have watched with enormous admiration how Canada has grown and matured while remaining true to its history, its distinctive character, and its values," the Queen said.

"This nation has dedicated itself to being a caring home for its own, a sanctuary for others and an example to the world."

Wearing a red suit, white gloves and white hat festooned with a red silk flower, Her Majesty arrived for the celebrations with Prince Philip in a horse-drawn carriage, with a mounted RCMP escort. They were greeted by Prime Minister Stephen Harper and his family.

"Welcome back to your home away from home – Canada," Harper said to the Queen at the start of his address to the Hill.

"The past year has been a great year for our country – (at) the Olympic and Paralympic Games, our fantastic athletes set a record for the most gold medals any nation has ever won at any Olympic Games," he said to cheers. "We are leading the world, beginning the recovery from the global recession, in the strongest economic position of any country on Earth.

"And of course, in this year, as in every year, in Haiti, Afghanistan, and elsewhere, our country is making a positive difference in the world through the work of our diplomats, our development workers and the men and women of the Canadian Forces."

The Queen was introduced by Canadian actor Christopher Plummer, as her personal Canadian flag flew atop Parliament Hill.

After the address, the Queen went on a walkabout and met some of the roughly 100,000 people who gathered on the Hill.

The Queen's presence on the Hill -- her first Canada Day appearance since 1997 -- brought a level of formality not usually seen at the typically raucous festivities.

The 84-year-old monarch was honoured with a 21-gun salute, displays by CF-18 jet fighters, as well as the aerobatic Snowbirds, a march-past by the Guard of Honour, and Quebec soprano Marie-Josee Lord, who sang a stirring rendition of "God Save the Queen."

Others at the bash on the Hill included figure skater Joannie Rochette, who won a bronze medal at the Vancouver Olympics.

Canadian musicians, including The Barenaked Ladies and Quebec singer Isabelle Boulay, paid tribute to her in a mid-day show -- a taste of the bigger, rowdier concert scheduled for the evening.

Longtime Parliament Hill Canada Day partygoers say the atmosphere this year was more electric than any other year in recent memory.

"What I am seeing today in Ottawa is just a major show of enthusiasm and support for the Queen and the Crown." Robert Finch of the Monarchist League of Canada told CTV News Channel. "It's almost a rock star-like atmosphere there."

He said while polls may show Canadians have less enthusiasm for the British monarchy than they've had in decades past, Thursday's crowd defied those polls.

Her Majesty arrived in Ottawa Wednesday for her 22nd visit to Canada and her first visit in 13 years. She will visit Winnipeg, Waterloo, Ont., and Toronto during the Royal tour, which wraps up July 6.

Across the country and globe

In Halifax, hundreds gathered in red and white in the city's historic Citadel Hill for Canada Day celebrations. The sidewalks below the fort were packed earlier in the day for a parade by the Royal Nova Scotia International Tattoo.

The city's official Canada Day ceremony also included a 21-gun salute, a flypast by the 12 Wing Shearwater airbase and a foot and arms drill by the 78th Highlanders.

Earlier in Newfoundland, hundreds braved a thick fog to become the first in the country to celebrate Canada Day.

In Edmonton, about 1,500 runners took to the streets for the annual holiday run. And in Saskatoon, about 50,000 walked through the city's Diefenbaker Park during a special ceremony.

Events also occurred elsewhere through the country.

In Afghanistan, Canadian troops had a Canada Day packed with beer, barbeque and a rocket attack, which are a regular occurrence. No one was hurt in the attack

Soldiers and citizens donned Canadian hockey jerseys and painted their faces with pride.

"It's definitely more poignant here. We're proud to be Canadian and represent our country here," Master Cpl. Cindy Brooks said.

Canadian Idol winner Theo Tams provided the entertainment.

Comedian Scott Harris had joked about rocket attacks prior to Tams taking the stage.

"I was in Canada House last night and I had never heard the siren before and all of a sudden everyone is lying on the floor," he said to the crowd.

"I thought does the last one on the floor have to buy drinks or something? So I laid down on the floor and I thought, 'Am I supposed to be scared or something?' Then I look over and the girl lying beside me yawns."

With files from The Canadian Press