Polling stations opened at 8 a.m. local time (0430 GMT) on Friday and are scheduled to close at 6:00 p.m. (1430 GMT), with the possibility of extensions by Interior Ministry. The final result will be announced on Saturday, although initial figures may come out sooner.
Leader of the Islamic Revolution Ayatollah Seyyed Ali Khamenei cast his ballot at a polling station in Tehran just as the voting began.
The runoff follows the June 28 election in which Masoud Pezeshkian and Saeed Jalili emerged as frontrunners, yet neither secured an outright majority.
Pezeshkian has a background as a health minister and is a legislator from Tabriz in the northwest. Jalili holds experience as a diplomat and the chief nuclear negotiator.
More than 24 million people participated in the June 28 election.
The election seeks to appoint a successor to President Raeisi, who passed away on May 19 in a tragic helicopter crash.
Mohsen Eslami, the spokesperson for the national election headquarters, indicated on Thursday that the number of polling stations remains consistent with the initial round, which stood at 58,640, although adjustments may be made in certain districts if needed.
He projected that preliminary results could be declared as soon as Saturday morning.
A total of 61 million individuals are eligible to vote, as confirmed by the election headquarters.
Increased turnout
Speaking to reporters on Friday, Tehran Governor Alireza Fakhari said that the participation has grown compared to last week.
"We have witnessed increased participation of people compared to the first round since early morning," he said.
"I checked the participation data at 10:30 a.m. and the participation has increased by 22 percent compared to the same hour of the first round," he said.
Meanwhile, Siamak Rahpeyk, deputy head of the Guardian Council, also pointed to the enhanced turnout.
According to the received reports from polling stations, people's participation has been "significant" compared to the previous round, he told reporters on Friday.