Modi offered flowers to the Sri Maha Bodhi, an object of worship and a symbol of sovereignty for the Buddhist-majority island, in the pilgrim city of Anuradhapura.
The Hindu-nationalist Indian premier also worshipped and offered robes to the tree during a previous visit in 2015, underscoring its religious and cultural importance to both nations.
The tree is guarded around the clock by monks, police, and armed troops.
On Saturday, Modi and Sri Lankan President Anura Kumara Dissanayake oversaw the signing of seven agreements including on defence and energy.
Modi's visit is seen as a strategic move to counter rival China's growing influence in the region.
“Our security is interdependent and interconnected.”
Dissanayake said he had assured Modi that Sri Lankan territory “will not be allowed to be used by anyone to undermine India's security”.
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