Ruled by Sultan Qaboos since 1970, Oman has made tentative steps in recent years towards reform, though political parties remain banned.
In 1994 it became the first Gulf monarchy to give the vote to women and in 2011 Qaboos decreed that elections be held for municipal councils.
More than 620,000 voters were registered to take part in Sunday's polls, which will choose councillors for 11 municipalities including the capital Muscat.
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The councillors will have limited powers, as authorities will designate chairmen and deputy chairmen for the municipalities from outside those elected.
"I voted for the person who will best represent me," Jawhara al-Zadjali said as she left a polling station in Muscat.
Voters across the country are choosing 202 councillors from among 731 candidates, including 23 women, for the four-year posts.
At the national level, Oman has a consultative council with limited powers, the 85-member Majlis al-Shura.
In 2011 Qaboos slightly expanded the powers of the Majlis al-Shura after unprecedented social unrest when the normally quiet nation became caught up in protests which swept the Arab world.