More than 3,000 Tibetans gathered on a square in front of the Potala Palace in the heart of Lhasa Saturday morning to mark the National Day.

The crowd, composed of people from various ethnic groups and all walks of life, attended a grand flag-raising ceremony at 10 a.m. and sang the national anthem in chorus as the five-starred flag was hoisted up.

"We are proud to celebrate the National Day here in Lhasa," said Yang Feng, a soldier with the Chinese People's Liberation Army (PLA). "China's recent success in launching the Tiangong-1 made us even prouder."

Just two days before the 62nd anniversary of the founding of the People's Republic of China, the country successfully launched its first unmanned space lab module, the Tiangong-1.

"As a soldier, we'll live up to our obligations in maintaining social stability in Tibet and contributing to its prosperity," said Yang.

Tibet has shifted from impoverished to prosperous, and from isolated to open in tandem with the growth of New China, said Qin Yizhi, secretary of Lhasa's municipal committee of the Communist Party of China.

Tsering Drolkar, 68, attended the ceremony dressed in a traditional Tibetan costume. "It's an important occasion. I'm happy and content with my life," he said, posing for a photo in front of the red-and-white Potala Palace and the national flag.

Festivity is in the air throughout Lhasa. Streets are decorated with flags, red lanterns, and red and yellow flowers. Many Tibetans have put up national flags on the roofs of their homes.

Most stores in downtown Lhasa have launched special promotions in hopes of increasing sales during the week-long holiday that started on Saturday.

"Today is my birthday," said Zhang Meng, a six-year-old girl from Shanghai, who was posing for a photo in front of the Jokhang Temple. "I'm really lucky to be born on such a special date."

Meanwhile, activities were held across the country Saturday to mark the National Day.

On Saturday morning, President Hu Jintao led the country's top leaders in marking the founding anniversary of New China and paying respect to the heroes who died for the country's independence and prosperity by lying flower baskets at the Monument to the People's Heroes in the heart of Beijing.