Some had risen very early, while others had stayed up all night to hear the decision from Buenos Aires, which came at 5:20 am local time.
Several channels had live coverage of the event, with public broadcaster NHK having begun its programming at 10.30 pm on Saturday.
As Olympic chief Jacques Rogge read the IOC decision, cheers and shouts rang out. Groups of ecstatic Japanese hugged each other and punched the air.
TV hosts and their guests were temporarily speechless and several were in tears, with some making reference to people living in the area affected by the earthquake-tsunami and the nuclear emergency it caused in March 2011.
At the MC's prompting, the crowd in unison said "arigato" (thank you) to Buenos Aires.
At Komozawa Olympic Park in the south of Tokyo, which served as a venue for several sports at the 1964 Tokyo Olympics, golden tinsel rained down at the moment of decision.
A boisterous crowd held signs and chanted "Tokyo, Tokyo, Tokyo, Tokyo," as an interviewer fought to be heard above the din.
Three-time Olympic women's 55kg wrestling champion Saori Yoshida, whose sport may be scrapped from the 2020 Games said she had been brought to tears by the news of Tokyo's victory.
"I am really pleased that Japan pulled together," she told reporters.
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