The event's Pride House, which was first set up during the 2010 Vancouver Winter Olympics, opened on Monday in Paris.
"The idea is to welcome everybody," organiser Jeremy Goupille told AFP.
"With a platform like the Olympics, we know we can change things."
The Summer Games this year include 193 openly LGBTQ athletes, up from 186 in the 2020 Games and 53 in 2016, specialised website Outsports says.
They include openly gay British diver Tom Daley, who on Monday won silver with partner Noah Williams in the 10m synchronised platform to give him a fifth medal in five Olympics.
US basketball star and LGBTQ activist Brittney Griner is back on the court after spending a gruelling nine months in a Russian jail in 2022.
Her team won gold in the last two Olympics in Rio and Tokyo.
Brazilian judoka Rafaela Silva, who won a gold at the Rio Games in 2016, will also be competing.'Welcoming' space
Pride House has been a feature of most Games since Vancouver, excluding the Winter Games in Sochi, Russia in 2014.
Organisers hope the LGBTQ athletes in Paris will provide inspiration for members of the community worldwide.
At least 67 countries criminalise same-sex relations between consenting adults, Human Rights Watch says.
Violence and harassment against LGBTQ people in Europe have reached a "new high" in the past few years, the European Union's rights agency says.
"Paris is the city of love, of all loves," exclaimed deputy mayor Jean-Luc Romero-Michel at the opening on Monday night.
In the crowd, 23-year-old Lucas and 26-year-old Remy, neither of whom wished to share their surname, had painted their cheeks with a French flag and were excited.
"After the backlash of the right and the far right, it's important to have a space that is welcoming, whatever a person's gender or sexual orientation," said Lucas, a student.
Australian skateboarder Poppy Starr Olsen said she was not competing this year after taking part in the Tokyo Games, but was there to cheer on the initiative.
"Skateboarding itself is really queer. So it's been a super awesome place for me to grow up as a queer person," the 24-year-old said.
"But you definitely experience hate sometimes, even if the people don't mean it... It's still there, which is why it's really important to have a Pride House."'We are all equal'
French Sports Minister Amelie Oudea-Castera said she too thought having the venue was key to "a message of inclusion".
"It's important for us to keep fighting against all types of discriminations," she said.
"We are all equal and we all deserve to be respected," she added.
She spoke after the Olympics opening ceremony on Friday sparked some controversy.
The sequence, a Greek mythology-inspired celebration including members of the LGBTQ community and a semi-naked singer painted in blue, had intended to promote diversity.
But Catholic groups and French bishops have accused it of being a disrespectful parody of the Last Supper between Jesus and his apostles.
US presidential candidate Donald Trump has called the segment "a disgrace".
Turkey's President Recep Tayyip Erdogan condemned the ceremony for "immorality against all Christians" and said he would report it to Pope Francis.
Oudea-Castera said the aim was not "to have any sort of provocation against any type of religion".
"It was a message of inclusion, reconciliation and celebration of the Olympics god Dionysos," who was father of Sequana, the goddess of the River Seine, she said.
