It was the first repatriation of victims from Malaysia Airlines Flight 17 to the country and the government has urged people to wear black and observe a minute of silence and prayer.
All 298 people onboard died when the plane was shot down over an area of eastern Ukraine controlled by pro-Russia separatists as it flew to Kuala Lumpur from Amsterdam.
The victims included 43 Malaysians and 195 Dutch nationals.
It was the first day of national mourning in Malaysia's history, in a country which is still coming to terms with the disappearance of Flight 370 and its 239 passengers and crew earlier this year.
The victims were carried aboard a specially chartered Malaysian Airlines jet from Amsterdam and received in a solemn ceremony on the tarmac of Kuala Lumpur International Airport.
The coffins were draped in the Malaysian flag and carried by teams of eight soldiers to waiting hearses before being taken to private funerals.
Malaysia has been spared many of the natural disasters that regularly strike other countries in Asia, but the downing of Flight 17 was the second tragedy to hit the national airline this year following the disappearance of Flight 370 on March 8.
The government was criticised for its response to the missing jet but Prime Minister Najib Razak won praise for brokering a deal with the pro-Russian separatists to allow for the return of all the bodies and ensure international access to the black box flight recorders.