The ground-breaking ceremony to mark the beginning of the tower's construction took place this morning at the site beside Grand Central Station.
At 1,501 feet, it will surpass the height of Rafael Vińoly's skinny residential skyscraper 432 Park Avenue (1,396 feet, 426 metres) but remain short of One World Trade Center's 1,776 feet (541 metres).
An entire city block was demolished to make way for the glass-sheathed skyscraper, which was designed by international architecture firm Kohn Pedersen Fox (KPF).
The project is going ahead after legal proceedings filed in 2015 over air rights were abandoned in August 2016.
Shaped to reference New York's Art Deco towers, One Vanderbilt will feature angled sides that finish in steps towards its spire-topped pinnacle.
The building will connect to Grand Central's concourse via a giant staircase and a series of escalators at its base.
Retail spaces and a large atrium will also occupy the lower floors, while 1.6 million square feet (148,644 square metres) of office space will sit above.
Sales opened for luxury condos at its 111 Murray Street tower in New York's Financial District in April 2016.