Thirty per cent of the families left homeless by the disaster are still in the process of rebuilding their homes.
Nepal on Thursday marked the fourth anniversary of a massive earthquake that killed almost 9,000 people and left millions homeless, some of whom are still living in temporary shelters.
Nepal's Prime Minister K.P. Sharma Oli joined locals and civil servants at a memorial in the Kathmandu Durbar Square, a UNESCO world heritage site being rebuilt after it was badly damaged in the April 2015 quake.
"I would like to offer my condolences to those all who lost their lives," Mr Oli said.
"We are here remembering the pain of that day... and it is also important to examine how much work we have been able to do in the last four years to restore and rebuild what we lost."
A minute's silence was observed around 11:56 am - the time the 7.8-magnitude quake hit, triggering avalanches and landslides across the Himalayan nation and destroying schools and hospitals.
The disaster also reduced more than a hundred monuments to rubble, including centuries-old temples and royal palaces in the Kathmandu valley that attracted visitors from around the world.
The National Reconstruction Authority, the government body overseeing rebuilding, said that half of the families left homeless in the quake have already completed reconstruction and started living in their new homes.
Another 30 per cent are currently building new homes.
Families were given about $3000 in government grants over three instalments to rebuild.
"We still have a lot to do and we will complete it in the next 20 months," chief of the authority Sushil Gyawali said, whose five-year mandate ends at the end of 2020.
But a $9 billion reconstruction effort has been plagued by political infighting, bureaucracy and confusion among quake victims over how to obtain the grants.
The government also faces an estimated $4 billion shortfall in reconstruction funds.
Experts also fear that a rush to rebuild has put pressure on quake survivors to take out expensive loans and build homes that may be too small to be functional for families.
"We are now sharing a three-roomed flat. Even this was built with a loan. Quake victims need more support from the government," said Sri Ram Shrestha, 48, who lost his two-storey house in the quake.
Nepal rests on a major fault line between two tectonic plates.
On the eve of the anniversary, the country was hit with three tremors, the strongest of which was 5.2 magnitude.