The popular Bachelet holds a commanding lead, with opinion polls showing the ex-president close to the 50 per cent needed to win in the first round of balloting.
Voting booths opened across the country at 8:00 am (1100 GMT), Chile's Electoral Service reported.
In one novelty, for the first time since democracy was restored in 1990 after a military dictatorship, voting is no longer compulsory.
Outgoing President Sebastian Pinera, who cannot run for re-election and took over when Bachelet's first term ended in 2010, earlier made a fervent call for a strong turnout.
More than 13 million of the country's 16.5 million inhabitants are registered to vote.
Soldiers are guarding the polling stations, which are scheduled to close at 6:00 pm (2100 GMT).
Voters will also elect 120 members of the chamber of deputies, 20 senators, and local and regional officials.
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