Srikakulam district collector Saurabh Gaur placed a wreath on Yerran's body on behalf of the government.
Yerran Naidu's son Rammohan lit the pyre set in the family's agriculture field.
Chandrababu, who was accompanied by his son Lokesh, was in tears as he bid final adieu to his closest aide.
Thousands of people from Srikakulam and neighbouring Vizianagaram district thronged Nimmada and paid homage to the departed leader, who had represented them in AP Legislative Assembly and Lok Sabha for four terms each.
State Civil Supplies Minister D Sridhar Babu, MP Madhu Yashki, MLAs Nagam Janardhan Reddy and S Venugopalachari were among those who paid homage to Yerran Naidu.