The pop star was joined by Mayor Michael Bloomberg for a ceremonial ribbon cutting before ascending a float that promoted the Ricky Martin Foundation, which advocates for child welfare around the world.
Fans screamed as the float made its way up Fifth Avenue. "We were about to pass out, we were so happy to see him," said Tania Ochoteco, 33, of the Bronx.
More screams greeted last year's grand marshals Marc Anthony and Jennifer Lopez, who made a surprise repeat appearance on separate floats.
New York Gov. Eliot Spitzer and Puerto Rican Gov. Anibal Acevedo-Vila joined Bloomberg at the head of the parade.
There were marching bands, beauty queens and uniformed city workers dancing to salsa blaring from scores of floats.
TV personality Geraldo Rivera held a flag in one hand and a microphone in the other.
Although it was impossible to estimate the crowd, hundreds of thousands have attended in recent years.
By Karen Matthews