The dramatic climax followed a rare public campaign to save the life of Balal, who at 19 killed another young man, Abdollah Hosseinzadeh, in a street fight with a knife back in 2007.
Shargh newspaper said police officers led Balal to a public execution site in the northern city of Nowshahr as a large crowd gathering on Tuesday morning.
Samereh Alinejad, mother of the victim who lost another son in a motorbike accident four years ago, asked the crowd whether they know "how difficult it is to live in an empty house."
She slapped him in the face and removed the rope from his neck assisted by her husband, Abdolghani Hosseinzadeh, a former professional footballer.
"I am a believer. I had a dream in which my son told me that he was at peace and in a good place... After that, all my relatives, even my mother, put pressure on me to pardon the killer," Alinejad told Shargh.
"The murderer was crying, asking for forgiveness. I slapped him in the face. That slap helped to calm me down," she said. "Now that I've forgiven him, I feel relieved."
"I've asked my friends not to carry knives... I wish someone had slapped me in the face when I wanted to carry one," Balal said in a television interview.
A high-profile campaign was launched by public figures including Adel Ferdosipour, a popular football commentator and TV show host, and former international footballer Ali Daei, appealed for the victim's family to forgive the killer.
According to the United Nations, more than 170 people have been executed in the Islamic republic since the beginning of 2014.
Under the country's interpretation of Islamic sharia laws in force since a 1979 revolution, murder and several other crimes are punishable by death.
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