Arriving at the house of Shahid Khaqan Abbasi, the current prime minister, in an official convoy under heavy security, Miss Yousafzai was moved to tears as she sought to discuss her exile from her homeland.
While she has been hailed by supporters as a champion against extremism, some Islamist hard-liners in Pakistan and elsewhere have criticized Yousafzai, calling her a mouthpiece for Western cultural views.
Prime Minister Abbasi in a warm welcome address said he was happy that a daughter of the nation has come to her motherland. She was immediately airlifted to the United Kingdom with her family to receive treatment. He said he was not sure whether Yousafzai will visit her home town, where schoolchildren were jubilant on her return, though they wished Yousafzai had visited Mingora so that they could greet her. "When I travel to cities like London or NY I always imagined that I am driving in Islamabad or Karachi", she said.
"I don't normally cry", she continued.
This led her to a Nobel Peace Prize at the age of 17, the youngest-ever recipient of the award. I saw women facing challenges in my society.
Now famous worldwide as simply Malala.
"Welcome home", Prime Minister Abbasi told Yousafzai. "But now today I see [that] I am very happy". I want to invest in the education of children.
It is not yet clear whether she will visit her home village in the Swat Valley.
"I wish she had come here, but we welcome her", she said.
At the start of her four-day trip, she was escorted through Islamabad's Benazir Bhutto International Airport amid tight security.
In 2012, Yousafzai and her classmates were attacked by Taliban gunmen on a bus ride home from school in Swat Valley, Pakistan. He also referred to the militants who wounded Yousafzai and the battle Pakistan is still fighting.
Yousafzai is now studying at Oxford University.
On March 23 when Pakistan celebrated Pakistan Day, Yousafzai tweeted, "I cherish fond memories of home, of playing cricket on rooftops and singing the national anthem in school".
Ms Yousafzai was flown, in a critical condition, to the garrison city of Rawalpindi before being airlifted to Birmingham in the UK.
They also blew up many girls' schools and imposed their strict version of Islamic law until they were finally driven out. She is a brilliant student, better for Pakistan. She will also participate in the "Meet the Malala" programme as well.
During her emotional speech on Thursday, Yousafzai celebrated the fact that "more than $6 million" has been put toward education in Pakistan in the years since her attack.
She is frequently attacked by religious conservatives as portraying her country in a bad light and seeking fame.
For much of Pakistan, waking up to Malala's return Thursday felt like the homecoming of a champion.
Local media say she will not visit her hometown in northwestern Pakistan because of security concerns.