Pope Francis issued Thursday a strong condemnation of modern society's vices as he urged the faithful to "act soberly" and show compassion in a Christmas Eve mass in St Peter's Basilica.

Thousands of people attended the service, one of the grandest in Catholic Church liturgy. The 79-year-old Francis, who said he was suffering from the flu at the start of the week, sounded slightly hoarse and did not appear to have fully recovered.

"In a society so often intoxicated by consumerism and hedonism, wealth and extravagance, appearances and narcissism, [Jesus] calls us to act soberly, in other words, in a way that is simple, balanced, consistent, capable of seeing and doing what is essential," he said in his homily.

Criticizing "a world which all too often is merciless to the sinner and lenient to the sin," and "a culture of indifference which not infrequently turns ruthless," Francis said "our lifestyle should instead be devout, filled with empathy, compassion and mercy."

Following tradition, the leader of the world's 1.2 billion Catholics entered St Peter's at around 9.30 pm (2030 GMT) holding a ferula - a silver papal stick with a cross - and preceded by a procession of cardinals and other top prelates. The service was expected to last two hours.

He lifted a cloth covering a baby Jesus in a symbolic celebration of his birth, and children from Belgium, Italy, Kenya, the Central African Republic, the Philippines, Sri Lanka, United States and Mexico laid flowers by the shrine holding the statue.

The pontiff, who was on Wednesday named as the winner of the 2016 Charlemagne Prize for acting as Europe's "voice of conscience," stressed God's loving nature in a Twitter message hours before the mass.

"God is in love with us. He becomes small to help us love him in return," it said.

Christmas celebrations fall in the middle of the Jubilee of Mercy, a months-long festival Francis inaugurated on December 8 and running through to November 20, which offers Catholics a chance to seek a general pardon for their sins.

They also come amid renewed scrutiny of Francis' reform efforts following VatiLeaks 2 revelations of Vatican financial scandals, simmering Catholic conservative discontent with the pope and heightened security in response to terrorist threats.

Celebrations were due to continue Friday with the traditional Christmas Day Urbi et Orbi (to the city and to the world) message and blessings, which the pope delivers from the central balcony of the Vatican basilica.

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