The governments of both Serbia and Kosovo have been promoting a strong turnout, but many people in the north are likely to boycott the vote.
Kosovar Serbs are concerned that if they vote, it will legitimize the independent state of Kosovo.
Kosovo unilaterally declared independence from Serbia in 2008.
The move had the support of Kosovo’s majority Albanian population, but not the small Serbian minority, which refuses to recognize the country’s independence.
For the first time, the government in Belgrade is putting pressure on Kosovo’s Serb population to take part in the municipal elections.
The change is down to a new agreement between Serbia and Kosovo to normalize relations, as Serbia seeks membership of the European Union.
Polling stations opened at 07:00 and will close at 19:00 local time.
Calls for independence from ethnic Albanians in Kosovo after the break-up of the former Yugoslavia led Serbia to stage a violent crackdown in the territory, which was bought to an end by a NATO military intervention in 1999.
Until it declared independence in 2008, Kosovo was administered by the United Nations.
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