The Spacex CEO had billed the takeoff as a risky first attempt, saying the challenges of building the Roadster meant the chances of success might only be 50-50.
However, his fears were not realised with the world’s most powerful rocket successfully taking off from the Kennedy Space Center at 3.45pm local time (8.45pm GMT).
About two and a half minutes after the launch, two of the three boosters on the rocket detached and landed upright, at the same time, at Cape Canaveral Air Force Station.
Mr Musk later tweeted a picture of his old Tesla car orbiting over Australia.
Among the online spectators was British Astronaut Tim Peake, who described the feat as “simply awesome”.