The elderly statesman spent the day out of the public eye, celebrating privately with his children and grandchildren at his Johannesburg home.
It took Mandela several attempts to blow out all the candles on his large blue and white birthday cake, decorated with strawberries.
Laughing and applauding, some staff members helped him finish the job.
Mandela then thanked them for helping him celebrate 88 years, saying that in his younger days it was not something he imagined would happen.
Leaning on a cane and supported by his wife Grace Machel, the Nobel laureate then toured an exhibition of photographs of his life and legacy.
His gifts this year include cigars and rum from Cuban President Fidel Castro, and shoes from women in his home province of the Eastern Cape.
South African President Thabo Mbeki, who followed in Mandela's footsteps after he stepped down in 1999, also sent birthday greetings.
Mandela, whose long battle against apartheid saw him jailed for 27 years before 1994 all-race elections made him South Africa's first black president, remains beloved as the grandfather of the nation and one of the few moral beacons with genuine worldwide reach.
Despite being in exceptional health for his age, this year's birthday was more muted compared to previous years, when he has been feted publicly.
"He is trying very hard to enjoy retirement but it's not easy. We are still inundated with requests for his time," said his spokeswoman, Zelda La Grange.
"At the age of 88 he is doing exceptionally well, health wise. However, there is less time for work and a bigger need for more time to attend to his health."
Officials at the Nelson Mandela Foundation say Mandela still goes to his office each week, and he frequently meets visiting dignitaries, who often end up donating to his favourite causes, which include children, education and Africa's battle against HIV/AIDS.
Mandela's next appearance is scheduled for Thursday, when he and other graduates of Fort Hare University - the alma mater of many heroes of the anti-apartheid struggle - will be given honourarium rings.
A week later, on July 29, his birthday will be capped by the Nelson Mandela Annual lecture, a speech in his honour delivered this year by Mbeki.