Operating from the former Futurist site, the big wheel is attracting the attention of residents and visitors alike with many stopping for a ride or simply to have a look.
Sue Dyas from Pontefract was one of the first passengers to get on the wheel with her grandson Callum.
"It was amazing," she said, "you get some beautiful views and you can see Scarborough from miles around."
"It's the first thing we've done today," said Rebecca Hassack from Teeside. "I think it's worth doing, as visitors it gives you some perspective as to where things are. It sort of inspires you to try other things."
The new attraction, operated by Observation Wheel UK, carries a maximum of 144 passengers with six people seated in each of its 24 gondolas. Each ride lasts for about eight to ten minutes.
"There's a wheel in Liverpool so why not here!," said David Rimmer after getting off while Glaswegians Alex Downie and Debbie Yule commented: "We'd go back up again that's how much we enjoyed it.
"I'm glad it's opened today because it's our last day."
Lorraine and Joan Black, from Edinburgh, used to live in Scarborough. Although they were sad to hear about the demolition of the Futurist, "anything that attracts business to coastal towns is a good thing".
They added: "You get fabulous views, you can see right over the harbour, right along to the Spa... My niece is just eight and she loved it."
Scarborough resident Dawn Avison, who is yet to try the wheel, was among the crowd of curious onlookers.
“I’m looking forward to getting on,” she said, “it’s only for a month but I hope they do well. It’s a good thing for Scarborough, I can’t think of anywhere better for it.”
Scarborough’s new wheel is open every day from 11am to 9.30pm until Monday August 26.
However, if the project proves to be successful planning permission could be granted to extend the lease until November 10.