The evictions appear to have gone ahead without incident, despite fears that the policy would lead to confrontation between the authorities and local residents.
The Mujahideen, mostly foreign volunteers during the 1992-95 civil war, are being treated as squatters even though they fought alongside government forces.
The first two fighters are reported to have left the houses they had been occupying in the small village of Bocinja, near Maglaj in central Bosnia, before the properties were sealed by police.
The evictions appear to have gone ahead without incident, despite fears that the policy would lead to confrontation between the authorities and local residents.
Last week, people living around the village put up roadblocks when they heard incorrect reports that the evictions were about to begin.
When the barricades came down three days later, 19 people were arrested, including several described as foreigners or Mujahideen.
Local Mayor Mehmed Bradaric told the French news agency, AFP, on Monday that the evictions would continue at the rate of two a day.
Married
The Mujahideen came from Iran, Afghanistan and other Islamic countries to fight alongside the Muslim-dominated Bosnian Government army during the war.
They have settled in villages around the town of Maglaj, where they have been living illegally in Serb-owned houses.
Under the Dayton peace accord that ended the Bosnian war, all foreign fighters were supposed to leave the country by 1996. But many of them now have Bosnian citizenship and have married Bosnian Muslim women.
Until now, the local authorities and the international community had tended to turn a blind eye, but now the Serbs, who were forced to flee during the war, want to reclaim their old homes.
Instability
The United Nations refugee agency, UNHCR, says Bocinja is a difficult area for refugee returns. The first people to be evicted will be displaced Serbs and Muslims; only then will the Mujahdeen be forced to leave.
The international crisis group which produces regular reports on Bosnia says the Mujahideen are a source of potential political and ethnic instability in central Bosnia.
Correspondents say that, by going ahead with the evictions, the government is putting the rights of property-owners ahead of the right to shelter, but it may prove to be the only way to deal with an otherwise insoluble problem.