The new pope, elected on May 8, called for an "authentic and lasting peace" in Ukraine, a ceasefire in Gaza, and the release of all Israeli hostages held by militant group Hamas.
Speaking in fluent Italian, Leo also welcomed the recent fragile ceasefire between India and Pakistan, negotiated overnight, and said he was praying to God to grant the world the "miracle of peace."
"No more war!" the pope said, repeating a frequent call of the late Pope Francis and noting the recent 80th anniversary of the end of World War Two, in which some 60 million people were killed.
Leo said today's world was living through "the dramatic scenario of a Third World War being fought piecemeal," again repeating a phrase coined by Francis.
Tens of thousands of people in St. Peter's Square and on the Via della Conciliazione leading to the Vatican broke into applause at the call for peace on what was a joyous occasion despite Leo's solemn message.
The new pope said he carries in his heart the "suffering of the beloved people of Ukraine."
Hours after Russian President Vladimir Putin proposed direct talks with Ukraine aimed at ending the bloody three-year war, Leo appealed for negotiations to reach an "authentic, just and lasting peace".
The pope also said he was "profoundly saddened" by the war in Gaza, calling for an immediate ceasefire, humanitarian aid and release of the remaining hostages held by Hamas.
Leo said he was glad to hear of the recent India-Pakistan ceasefire and hoped negotiations would lead to a lasting accord between the nuclear-armed neighbors.
He added: "But there are so many other conflicts in the world!"
MARCHING BANDS
Leo, the former Cardinal Robert Prevost, is the first U.S.-born pontiff and was a relative unknown on the world stage before his election.
He previously served for decades as a missionary in Peru before first becoming a cardinal to take up a senior Vatican role two years ago.
Leo's first Sunday address coincided with a previously planned pilgrimage to Rome by marching bands from around the world.
Minutes before the pope addressed the crowd, bands marched up the broad boulevard leading to the Vatican playing songs such as Y.M.C.A. by the Village People, the theme from the film Rocky, and music by John Philip Sousa, who composed the marching classic "Stars and Stripes Forever".
Peruvian Gladys Ruiz, who lives in Rome, was among the crowd in the square, estimated at more than 100,000 by Italian authorities. Calling Leo a "Peruvian pope" Ruiz said his election is "a great honour for us". Leo has dual citizenship, having gained Peruvian citizenship in 2015.
Also present were Dennis Gilligan and wife Maureen from Boston, Massachusetts, visiting Rome for their anniversary. He said he had passed up an opportunity to see Pope John Paul II when he visited Boston in 1979.
"I regretted it all my life," he said. "This was very moving."
The crowd was also entertained by bands from Italy, Mexico and other parts of Latin America who came to Rome for the ongoing Catholic Holy Year.
In all of his appearances since his election, Leo has not made any mention of the country of his birth, angering some U.S. conservative commentators.
