The white banner, emblazoned with a Quranic verse, was hoisted by Mullah Mohammad Hassan Akhund, the prime minister of the Taliban interim government, in a low-key ceremony, said Ahmadullah Muttaqi, multimedia branch chief of the Taliban' s cultural commission.
The flag-raising marked the official start of the work of the new government, he said.
The composition of the all-male, all-Taliban government was announced earlier this week and was met with disappointment by the international community which had hoped the Taliban would make good on an earlier promise of an inclusive line-up.
In a tweet, Afghanistan's first president to follow the 2001 collapse of the Taliban, Hamid Karzai, called for "peace and stability" and expressed the hope that the new caretaker Cabinet that included no women and no non-Taliban would become "inclusive government can be the real face of whole Afghanistan.”
He marked the 20th anniversary of the September 11 attacks on the US with a meeting of tribal elders on his high-walled compound in the Afghan capital where he has remained with his family since the August return of the Taliban to Kabul.
Two decades ago, the Taliban ruled Afghanistan with a heavy hand.
Television was banned, and on September 11 2001, the day of the horrific attacks on America, the news spread from crackling radios across the streets of the Afghan capital of Kabul.
It took the US-led coalition just two months to drive the Taliban from the capital and by December 7, 2001.