The singer is one of 21 modern-day icons whose faces can be seen stretching 900ft around the outside of Selfridges in Oxford Street.
The eye-catching work, titled XV Seconds, is the brainchild of Sam Taylor-Wood - one of the UK's most talented young artists.
The 32-year-old said she wanted to create an updated version of the famous Elgin marble frieze, replacing the Greek gods with cultural figures.
Joining Elton on display are Blur guitarist Alex James, actors Ray Winstone, Richard E Grant, Timothy Spall and Adrian Dunbar and actresses Jane Horrocks and Amanda Ooms.
It also features models Jodie Kidd and Alek Wek and dancer Steven Galloway.
The giant photograph, which weighs two tons and stands 60ft tall, will stay on display until October.
It is attached to scaffolding erected around the building while restoration work is carried out.
Gods
Taylor-Wood, who was short-listed for the Turner Prize in 1998, said: "I conceived this work as a contemporary version of the Elgin marble frieze from the Parthenon, peopled with modern-day 'gods', to adorn a temple of shopping."
Sir Elton was suitably impressed. Joining Taylor-Wood to view the work from above, he said his inclusion was very appropriate as he was the god of shopping.
Nick Cross, marketing director of Selfridges, said: "We want to bring to the 20 million customers who visit Selfridges each year the excitement of public art on a grand scale.
"This work by Sam Taylor-Wood precisely represents the bravura and imagination of today's British artists which we admire."
Taylor-Wood was nominated for the Turner Prize in 1998 for her film about relationships, Atlantic.
She also worked with the Pet Shop Boys on their UK tour in 1999.
The frieze will remain in place until October.