Pope Benedict XVI, the Archbishop of Canterbury and British Muslim leaders were among participants invited to the launch, as were rock stars turned development campaigners Bob Geldof and U2 frontman Bono.
The 2.1-billion-pound (3.1-billion-euro, 4.0-billion-dollar) International Finance Facility for Immunisation aims to pay for 500 million children over the next decade to be protected against polio, measles, diphtheria and hepatitis.
The launch was an immediate success in the City, with Goldman Sachs saying the initial offer had been oversubscribed 1.75 times.
The fund works by selling long-term bonds to international money markets to raise money for developing countries now, with interest on these paid back using future aid funding.
"We have it in our power, in this world, to prevent these diseases of
polio, tuberculosis, of diphtheria, of tetanus. It is possible do to this," the chancellor told GMTV television.
"In time, it will be possible to prevent malaria and hopefully HIVAIDS. But the money that is being put in will mean that every child in the world will have a better chance tomorrow and in days to come, of avoiding these unnecessary, preventable and avoidable diseases.
"I think that is probably the best Christmas present for every child in the world," he added.
Brown, expected to succeed Tony Blair as British prime minister next year, was to present religious leaders with bonds worth 670 pounds, which they are buying to show support for the initiative at the formal London launch later on Tuesday.
Among those giving their backing are the head of the Anglican church, Archbishop of Canterbury Doctor Rowan Williams, and the Muslim Council of Britain, an umbrella group.
Pope Benedict XVI was to be represented by Cardinal Renato Raffaele Martino, the Vatican said. Also scheduled to attend the launch in London were Bono and Geldof, organiser of the Live 8 anti-poverty concerts last year.
Chief Rabbi Dr Jonathan Sacks, Iqbal Khan of the Muslim Forum, Ramesh Khallidi of the Hindu Forum, and Indrajit Singh of the Sikh Council of Britain were also due to be present. So was Queen Rania Al-Abdullah of Jordan, a board member of the Global Alliance for Vaccines and Immunisation.
The idea for the fund came from Brown's Treasury and Britain's Department for International Development. It has also been supported financially by Brazil, France, Italy, Norway, South Africa, Spain and Sweden.
Brown has long been an advocate of a far more ambitious bond scheme to bring forward 50 billion dollars a year in aid flows but has so far been unable to persuade US leaders.
But he was clearly proud of Tuesday's initiative.
"We are making a commitment as a Government for the next 10-15 years that we will pay the repayments on what is the advance purchase of vaccinations, the immunisations that will be done very quickly," he told BBC radio.
"That is the right thing to do. There is no better case for advancing money than vaccination."

Copyright AFP (Agence France-Presse), 2006